Church Company completes these transactions and events during March of the curre
ID: 2487460 • Letter: C
Question
Church Company completes these transactions and events during March of the current year (terms for all its credit sales are 3/10, n/30).
Purchased $39,000 of merchandise from Van Industries, invoice dated March 1, terms 3/15, n/30.
Purchased $1,170 of office supplies on credit from Gabel Company, invoice dated March 3, terms n/10 EOM.
Purchased $19,500 of office equipment on credit from Spell Supply, invoice dated March 9, terms n/10 EOM.
Purchased $25,000 of merchandise from the CD Company, invoice dated March 13, terms 3/10, n/30.
Issued Check No. 417, payable to Payroll, in payment of sales salaries expense for the first half of the month, $17,300. Cashed the check and paid the employees.
Cash sales for the first half of the month are $62,400 (cost is $49,920). (Cash sales are recorded daily, but are recorded only twice here to reduce repetitive entries.)
Purchased $1,690 of store supplies on credit from Gabel Company, invoice dated March 16, terms n/10 EOM.
Received a $2,500 credit memorandum from CD Company for the return of unsatisfactory merchandise purchased on March 14.
Received a $585 credit memorandum from Spell Supply for office equipment received on March 9 and returned for credit.
Issued Check No. 418 to CD Company in payment of the invoice of March 13 less the March 17 return and the discount.
Issued Check No. 419, payable to Payroll, in payment of sales salaries expense for the last half of the month, $17,300. Cashed the check and paid the employees.
Cash sales for the last half of the month are $68,640 (cost is $41,184).
Verify that amounts impacting customer and creditor accounts were posted and that any amounts that should have been posted as individual amounts to the general ledger accounts were posted. Foot and crossfoot the journals and make the month-end postings.
Assume the following ledger account amounts Inventory (March 1 beg. bal. is $62,000), Z. Church, Capital (March 1 beg. bal. is $62,000) and Church Company uses the perpetual inventory system.
1. Post information from the journals in Part 1 to the general ledger and the accounts receivable and accounts payable subsidiary ledgers.
2. Prepare the March 31 trial balance, schedule of accounts receivable and schedule of accounts payable.
3. Schedule of Accounts Payable
4. Schedule of Accounts Recievable
Church Company completes these transactions and events during March of the current year (terms for all its credit sales are 3/10, n/30).
Explanation / Answer
SALES JOURNAL
Date
Account Debited
Invoice
Number
PR
Accounts Receivable
Dr.
Sales Cr.
Cost of Goods Sold Dr.
Inventory Cr.
Mar.
2
MM Cho
854
?
15,600
7800
3
Lance Snow
855
?
7,800
3900
10
Taylor Few
856
?
3,900
1950
27
Taylor Few
857
?
11,700
4680
28
Lance Snow
858
?
4,860
1872
31
Totals
$43,860
$20,202
PURCHASES JOURNAL
Page 2
Date
Account
Date of
Invoice
Terms
PR
Accounts
Payable
Cr.
Inventory
Dr.
Office
Supplies
Dr.
Other
Accounts
Dr.
Mar.
1
Soy Industries
3/1
2/15, n/30
../
39000
39000
3
Stacy Company
3/3
n/10,
EOM
?
1,170
1,170
9
Office
Equipment Supply
3/9
n/10,
EOM
163/?
19500
19500
14
The JW Company
3/13
2/10, n/30
?
25000
25000
16
Store Supplies/Stacy Company
3/16
n/10,
EOM
125/?
1690
1690
31
Totals
86360
64000
1170
21190
CASH RECEIPTS JOURNAL
Page 2
Date
Account
Credited
Explanation
PR
Cash
Dr.
Sales
Discount
Dr.
Accounts
Receivable
Cr.
Sales
Cr.
Other
Accts.
Cr.
Cost of
Goods
Sold Dr.
Inventory
Cr.
Mar.
6
L.T.
Notes Pay.
Note to bank
251
72,000
72,000
12
Min Cho
Invoice, 3/2
../
15,132
468
15,600
13
Lance Snow
Invoice 3/3
../
7,566
234
7,800
15
Sales
Cash sales
../
62400
62400
49920
20
Taylor Few
Invoice.
3/10
../
3,783
117
3,900
31
Sales
Cash sales
]
68640
68640
41,184
31
Totals
229,521
819
27,300
131,040
72,000
91,104
CASH DISBURSEMENTS JOURNAL
Page 2
Date
Ck.
No.
Payee
Account Debited
PR
Cash
Cr.
Inventory
Cr.
Other
Accounts
Dr.
Accounts
Payable
Dr.
Mar.13
416
Soy Industries
Soy Industries
?
37830
1170
39000
15
417
Payroll
Sales
Salaries Expense
621
17300
17300
23
418
The JW Co.
The JW Company
?
24250
750
25000
24250
31
419
Payroll
Sales
Salaries Expense
621
17300
17300
31
Totals
79380
1920
42300
63250
Schedule of accounts receivable
27
Taylor Few
11,700
28
Lance Snow
4,860
31
Totals
16,560
SALES JOURNAL
Date
Account Debited
Invoice
Number
PR
Accounts Receivable
Dr.
Sales Cr.
Cost of Goods Sold Dr.
Inventory Cr.
Mar.
2
MM Cho
854
?
15,600
7800
3
Lance Snow
855
?
7,800
3900
10
Taylor Few
856
?
3,900
1950
27
Taylor Few
857
?
11,700
4680
28
Lance Snow
858
?
4,860
1872
31
Totals
$43,860
$20,202
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