Transactions related to revenue and cash receipts completed by Aspen Architects
ID: 2426614 • Letter: T
Question
Transactions related to revenue and cash receipts completed by Aspen Architects Co. during the period June 2–30, 2016, are as follows:
June 2.
Issued Invoice No. 793 to Nickle Co., $7,330.
June 5.
Received cash from Mendez Co. for the balance owed on its account.
June 6.
Issued Invoice No. 794 to Preston Co., $2,640.
June 13.
Issued Invoice No. 795 to Shilo Co., $3,930.
Post revenue and collections to the accounts receivable subsidiary ledger.
June 15.
Received cash from Preston Co. for the balance owed on June 1.
June 16.
Issued Invoice No. 796 to Preston Co., $8,210.
Post revenue and collections to the accounts receivable subsidiary ledger.
June 19.
Received cash from Nickle Co. for the balance due on invoice of June 2.
June 20.
Received cash from Preston Co. for invoice of June 6.
June 22.
Issued Invoice No. 797 to Mendez Co., $10,820.
June 25.
Received $2,990 note receivable in partial settlement of the balance due on
the Shilo Co. account.
June 30.
Recorded cash fees earned, $18,460.
Post revenue and collections to the accounts receivable subsidiary ledger.
Required:
1. Insert the following balances in the general ledger as of June 1:
11
Cash
$16,240
12
Accounts Receivable
19,780
14
Notes Receivable
8,610
41
Fees Earned
-
After completing the recording of the transactions in the journals in part 3, total each of the columns of the special journals, and post the individual entries and totals to the general ledger. Insert account balances after the last posting. When posting to the general ledger, post in chronological order. However, if there is more than one entry on the same date, be sure to post transactions from the revenue journal before posting transactions from the cash receipts journal.
If an amount box does not require an entry, leave it blank.
GENERAL LEDGER
Date
Item
Post.
Ref.
Debit
Credit
Balance Dr.
Balance Cr.
Account: Cash # 11
2016
June 1
Balance
Account: Accounts Receivable # 12
2016
June 1
Balance
Account: Notes Receivable # 14
2016
June 1
Balance
Account: Fees Earned # 41
2016
2. Insert the following balances in the accounts receivable subsidiary ledger as of June 1:
Mendez Co.
$11,370
Nickle Co.
-
Preston Co.
8,410
Shilo Co.
-
After completing the recording of the transactions in the journals in part 3, post to the accounts receivable subsidiary ledger in chronological order, and insert the balances at the points indicated in the narrative of transactions. Determine the balance in the customer's account before recording a cash receipt. If an amount box does not require an entry, leave it blank.
ACCOUNTS RECEIVABLE SUBSIDIARY LEDGER
Date
Item
Post. Ref.
Debit
Credit
Balance
Account: Mendez Co.
2016
June 1
Balance
Account: Nickle Co.
2016
Account: Preston Co.
2016
June 1
Balance
Account: Shilo Co.
2016
3. Prepare a single-column revenue journal (p. 40) and a cash receipts journal (p. 36). Use the following column headings for the cash receipts journal: Fees Earned Cr., Accounts Receivable Cr., and Cash Dr. The Fees Earned column is used to record cash fees.
4. Using the two special journals and the two-column general journal (p. 1), journalize the transactions in chronological order for June. Post to the accounts receivable subsidiary ledger (in part 2), and insert the balances at the points indicated in the narrative of transactions. Determine the balance in the customer's account before recording a cash receipt.
5. Total each of the columns of the special journals, and post the individual entries and totals to the general ledger (in part 1). Insert account balances after the last posting.
If an amount box does not require an entry, leave it blank.
REVENUE JOURNAL
PAGE 40
Date
Invoice No.
Account Debited
Post. Ref.
Accounts Rec. Dr.
Fees Earned Cr.
2016
CASH RECEIPTS JOURNAL
PAGE 36
Date
Account Credited
Post. Ref.
Fees Earned Cr.
Accts. Rec. Cr.
Cash Dr.
2016
JOURNAL
PAGE 1
Date
Description
Post Ref.
Debit
Credit
2016
6. What is the sum of the customer balances?
$
Does the sum of the customer balances agree with the accounts receivable controlling account in the general ledger?
7. Would an automated system omit postings to a controlling account as performed in step 5 for Accounts Receivable?
June 2.
Issued Invoice No. 793 to Nickle Co., $7,330.
June 5.
Received cash from Mendez Co. for the balance owed on its account.
June 6.
Issued Invoice No. 794 to Preston Co., $2,640.
June 13.
Issued Invoice No. 795 to Shilo Co., $3,930.
Post revenue and collections to the accounts receivable subsidiary ledger.
June 15.
Received cash from Preston Co. for the balance owed on June 1.
June 16.
Issued Invoice No. 796 to Preston Co., $8,210.
Post revenue and collections to the accounts receivable subsidiary ledger.
June 19.
Received cash from Nickle Co. for the balance due on invoice of June 2.
June 20.
Received cash from Preston Co. for invoice of June 6.
June 22.
Issued Invoice No. 797 to Mendez Co., $10,820.
June 25.
Received $2,990 note receivable in partial settlement of the balance due on
the Shilo Co. account.
June 30.
Recorded cash fees earned, $18,460.
Post revenue and collections to the accounts receivable subsidiary ledger.
Explanation / Answer
GENERAL LEDGER
Date
Item
Post.
Ref.
Debit
Credit
Balance Dr.
Balance Cr.
Account: Cash # 11
2016
June 1
Balance
16240
16240
June 5
Receipt
11370
27610
June 15
Receipt
8410
36020
June 19
Receipt
7330
43350
June 20
Receipt
2640
45990
June 30
18460
64450
Account: Accounts Receivable # 12
2016
June 1
Balance
19780
19780
June 2
Invoice
7330
27110
June 5
Recepit
11370
15740
June 6
Invoice
2640
18380
June 13
Invoice
3930
22310
June 15
Receipt
8410
13900
June 16
Invoice
8210
22110
June 19
Receipt
7330
14780
June 20
Receipt
2640
12140
June 22
Invoice
10820
22960
June 25
Receipt
2990
19970
Account: Notes Receivable # 14
2016
June 1
Balance
8610
8610
June 25
Received
2990
11600
Account: Fees Earned # 41
2016
June 2
Invoice
7330
7330
June 6
Invoice
2640
9970
June 13
Invoice
3930
13900
June 16
Invoice
8210
22110
June 22
Invoice
10820
32930
June 30
Fees
18460
51390
ACCOUNTS RECEIVABLE SUBSIDIARY LEDGER
Date
Item
Post. Ref.
Debit
Credit
Balance
Account: Mendez Co.
2016
June 1
Balance
11370
11370
June 5
Receipt
11370
-
June 22
Invoice
10820
10820
Account: Nickle Co.
2016
June 2
Invoice
7330
7330
June 19
Receipts
7330
-
Account: Preston Co.
2016
June 1
Balance
8410
8410
June 6
Invoice
2640
11050
June 15
Rceipt
8410
2640
June 16
Invoice
8210
10850
June 20
Receipt
2640
8210
Account: Shilo Co.
2016
June 13
Invoice
3930
3930
June 25
Settlement
2990
940
REVENUE JOURNAL
PAGE 40
Date
Invoice No.
Account Debited
Post. Ref.
Accounts Rec. Dr.
Fees Earned Cr.
2016
June 2
793
Nickle Co.
7330
June 6
794
Preston Co.
2640
June 13
795
Shilo co.
3930
June 16
796
Preston Co.
8210
June 22
797
Mendez Co.
10820
CASH RECEIPTS JOURNAL
PAGE 36
Date
Account Credited
Post. Ref.
Fees Earned Cr.
Accts. Rec. Cr.
Cash Dr.
2016
June 5
Mendez Co.
11370
11370
June 15
Preston Co.
8410
8410
June 19
Nickle Co.
7330
7330
June 20
Preston co.
2640
2640
June 30
Fees earned
18460
18460
JOURNAL
PAGE 1
Date
Description
Post Ref.
Debit
Credit
June 2
Nickle Co. Dr.
To Fees Earned
Invoice No. 793
7330
7330
June 5
Cash A/c Dr.
To Mendez Co.
11370
11370
June 6
Preston Co. Dr.
To Fees Earned
Invoice no. 794
2460
2460
June 13
Shilo Co. Dr.
To Fees Earned
Invoice no. 795
3930
3930
June 15
Cash A/c Dr.
To Preston Co.
8410
8410
June 16
Preston Co. Dr.
To Fees Earned
Invoice No. 796
8210
8210
June 19
Cash A/c Dr.
To Nickle Co.
7330
7330
June 20
Cash A/c Dr.
To Preston Co.
2640
2640
June 22
Mendez co. Dr.
To Fees Earned
Invoice No. 797
10820
10820
June 2
Note receivable Dr.
To Shilo Co.
Settlement
2990
2990
June 30
Cash A/c Dr.
To Fees Earned
18460
18460
6. Customer Balances reconciled with Accounts receivable
&. Automated system would not omit postings to a controlling account
GENERAL LEDGER
Date
Item
Post.
Ref.
Debit
Credit
Balance Dr.
Balance Cr.
Account: Cash # 11
2016
June 1
Balance
16240
16240
June 5
Receipt
11370
27610
June 15
Receipt
8410
36020
June 19
Receipt
7330
43350
June 20
Receipt
2640
45990
June 30
18460
64450
Account: Accounts Receivable # 12
2016
June 1
Balance
19780
19780
June 2
Invoice
7330
27110
June 5
Recepit
11370
15740
June 6
Invoice
2640
18380
June 13
Invoice
3930
22310
June 15
Receipt
8410
13900
June 16
Invoice
8210
22110
June 19
Receipt
7330
14780
June 20
Receipt
2640
12140
June 22
Invoice
10820
22960
June 25
Receipt
2990
19970
Account: Notes Receivable # 14
2016
June 1
Balance
8610
8610
June 25
Received
2990
11600
Account: Fees Earned # 41
2016
June 2
Invoice
7330
7330
June 6
Invoice
2640
9970
June 13
Invoice
3930
13900
June 16
Invoice
8210
22110
June 22
Invoice
10820
32930
June 30
Fees
18460
51390
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