Problem 5-9A At the beginning of the current season on April 1, the ledger of Gr

Question

Problem 5-9A

At the beginning of the current season on April 1, the ledger of Granite Hills Pro Shop showed Cash $3,030; Inventory $4,030; and Common Stock $7,060. The following transactions occurred during April 2017.

Journalize the April transactions using a periodic inventory system. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem. Round answers to 0 decimal places, e.g. 5,275.)

Using T accounts, enter the beginning balances in the ledger accounts and post the April transactions. (Post entries in the order of journal entries posted in part a. Round answers to 0 decimal places, e.g. 5,275. For accounts that have a zero balance select "4/30 Bal." from the list and enter 0 for the amount.)

Prepare a trial balance on April 30, 2017. (Do not list those accounts that have zero ending balance.)

Prepare an income statement through gross profit, assuming inventory on hand at April 30 is $4,519.

Apr. 5 Purchased golf bags, clubs, and balls on account from Arnie Co. $1,590, terms 3/10, n/60. 7 Paid freight on Arnie Co. purchases $85. 9 Received credit from Arnie Co. for merchandise returned $290. 10 Sold merchandise on account to members $1,420, terms n/30. 12 Purchased golf shoes, sweaters, and other accessories on account from Woods Sportswear $880, terms 1/10, n/30. 14 Paid Arnie Co. in full. 17 Received credit from Woods Sportswear for merchandise returned $80. 20 Made sales on account to members $859, terms n/30. 21 Paid Woods Sportswear in full. 27 Granted credit to members for clothing that did not fit properly $85. 30 Received payments on account from members $1,293.

Explanation / Answer

Opening Trial Balance as at April 1 Particulars Amount(Dr.) Amount(Cr.) Cash 3030 Inventory 4030 Common Stock 7060 Total 7060 7060 Journal Entries: S. No. Particulars Amount Dr Amount Cr Cash Account 05-Apr Purchases Account Dr 1590 To Balance bd 3030 By Freights 85 To Amie Co 1590 By Amie Account 1261 (Being purchases made on account) To Members 1293 By Wood Sports 792 07-Apr Frieght Account Dr. 85 By Bal Cd 2185 To Cash 85 Total 4323 Total 4323 (Being Frieght inward paid) 09-Apr Amie Co Dr. 290 Members Account To Purchases Return Account 290 By Sales Return 85 (Being Returns booked) To Sales 1420 By Cash 1293 10-Apr Members Account Dr. 1420 To Sales 859 By Bal Cd 901 To Sales Account 1420 (Being cr Sales Recorded) Total 2279 2194 12-Apr Purchases Account Dr 880 To Woods Sportswear 880 (Being purchases made on account) Net Purchases from Amiie 1300 14-Apr Amie Co Dr. 1300 Disount for Pay within time 39 To Cash Account 1261 Net Payment 1261 To Discount Received 39 (Being Account settled) 17-Apr Woods Sportswear Dr. 80 To Purchases Return Account 80 (Being Returns booked) 20-Apr Members Account Dr. 859 To Sales Account 859 (Being cr Sales Recorded) 21-Apr Woods Sportswear Dr. 800 Net Purchases from Woods 800 To Cash Account 792 Disount for Pay within time 8 To Discount Received 8 Net Payment 792 (Being Account settled) 27-Apr Sales Return Account Dr. 85 TO Members Account 85 (Being Sales return booked) 30-Apr Cash Account Dr. 1293 Net Due from Members 2194 To Members Account 1293 Less: Payment Rec 1293 (Being Payment RecievedP Net Outstanding 901 8682 8682 Clsoing Trial Balance Particulars Amount(Dr.) Amount(Cr.) Cash 2185 Inventory 4030 Common Stock 7060 Puchases 2470 Puchases Return 370 Sales 2279 Sales Return 85 Freight 85 Member Account 901 Discount Received 47 Total 9756 9756 Closing Stock 4519 Income Statement For the Month of April Sales (Net of Returns) 2194 Less: COGS Opening Stock 4030 Purchases( Net of Returns) 2100 Less: Closing Stock 4519 1611 Direct Expenses: Frieght In wards 85 Gross Profit 498 Other Income: Discount Received 47 Profits 545

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