(a) Record the January transactions in a cash receipts journal, Check figures: C
ID: 2576800 • Letter: #
Question
(a) Record the January transactions in a cash receipts journal,
Check figures:
Cash Receipts Journal, total Cash DR: $ 70,348
Cash Payments Journal, total Cash CR: 62,060
Net Income: 25,218 Total Assets: 149,568
Total Post Closing Trial Balance: 151,193
Sun & Surf Company uses a perpetual inventory system and both an accounts receivable and an accounts payable subsidiary ledger. Balances related to both the general ledger and the subsidiary ledger for Sun & Surf are indicated in the working papers. Below are a series of transactions for Sun & Surf Co. for the month of January. Credit sales terms are 2/10, n/30. The cost of all merchandise sold was 55% of the sales price.
Jan.3 Sell merchandise on account to M. Knast $5,100, invoice no. 825, and to C. Ryder $1,900, invoice no. 826.
5 Purchase merchandise from R. Drifter $5,000 and N. Sova $2,200, terms n/30.
7 Receive checks from V. Arnold $4,000 and I. Tan $2,000 after discount period has lapsed.
8 Pay freight on merchandise purchased $235.
9 Send checks to K. Xerxes for $9,000 less 2% cash discount, and to T. Caper for $11,000 less 1% cash discount.
9 Issue credit of $300 to C. Ryder for merchandise returned.
10 Summary daily cash sales total $15,500.
11 Sell merchandise on account to D. Gallagher $1,600, invoice no. 827, and to V. Arnold $900, invoice no. 828.
12 Pay rent of $1,000 for January.
13 Receive payment in full from M. Knast and C. Ryder less cash discounts.
15 Withdrawal of $800 cash by J. Sandy for personal use.
15 Post all entries to the subsidiary ledgers.
16 Purchase merchandise from T. Caper $18,000, terms 1/10, n/30; K. Xerxes $14,200, terms 2/10, n/30; and R. Drifter $1,500, terms n/30.
17 Pay $400 cash for office supplies.
18 Return $200 of merchandise to K. Xerxes and receive credit.
20 Summary daily cash sales total $20,100.
21 Issue $15,000 note, maturing in 90 days, to M. Griffen in payment of balance due.
21 Receive payment in full from V. Arnold less cash discount.
22 Sell merchandise on account to M. Knast $2,700, invoice no. 829, and to D. Gallagher $1,300, invoice no. 830.
22 Post all entries to the subsidiary ledgers.
23 Send checks to T. Caper and K. Xerxes in full payment less cash discounts.
25 Sell merchandise on account to I. Tan $3,500, invoice no. 831, and to C. Ryder $6,100, invoice no. 832.
27 Purchase merchandise from T. Caper $14,500, terms 1/10, n/30; N. Sova $1,200, terms n/30; and R. Drifter $5,400, terms n/30.
27 Post all entries to the subsidiary ledgers.
28 Pay $275 cash for office supplies.
31 Summary daily cash sales total $21,300.
31 Pay salaries and wages of $8,100. (continued)
Page 2 of 2
Instructions
(a) Record the January transactions in a a cash receipts journal,
1. Office supplies at January 31 total $900.
2. Insurance coverage expires on September 30, 2017.
3. Annual depreciation on the equipment is $1,500.
4. Interest of $50 has accrued on the note payable.
General Ledger
Cash
No. 101
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 1
Balance
$ 37,150
Accounts Receivable
No. 112
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 1
Balance
$ 13,000
Notes Receivable
No. 115
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 1
Balance
$ 39,000
Inventory
No. 120
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 1
Balance
$ 17,795
Office Supplies
No. 125
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 1
Balance
$ 1,200
Prepaid Insurance
No. 130
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 1
Balance
$ 2,205
Equipment
No. 157
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 1
Balance
$ 6,450
Accumulated Depreciation - Equipment
No. 158
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 1
Balance
$ 1,500
Notes Payable
No. 200
Date
Explanation
Ref.
Debit
Credit
Balance
Accounts Payable
No. 201
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 1
Balance
$ 35,000
Interest Payable
Date
Explanation
Ref.
Debit
Credit
Balance
J. Sandy, Capital
No. 301
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 1
Balance
$ 80,300
J. Sandy, Drawing
No. 306
Date
Explanation
Ref.
Debit
Credit
Balance
Income Summary
No. 350
Date
Explanation
Ref.
Debit
Credit
Balance
Sales
No. 401
Date
Explanation
Ref.
Debit
Credit
Balance
Sales Returns and Allowances
No. 412
Date
Explanation
Ref.
Debit
Credit
Balance
Sales Discounts
No. 414
Date
Explanation
Ref.
Debit
Credit
Balance
Cost of Goods Sold
No. 505
Date
Explanation
Ref.
Debit
Credit
Balance
Salaries and Wages Expense
No. 627
Date
Explanation
Ref.
Debit
Credit
Balance
Depreciation Expense
No. 711
Date
Explanation
Ref.
Debit
Credit
Balance
Interest Expense
No. 718
Date
Explanation
Ref.
Debit
Credit
Balance
Insurance Expense
No. 722
Date
Explanation
Ref.
Debit
Credit
Balance
Office Supplies Expense
No. 728
Date
Explanation
Ref.
Debit
Credit
Balance
Rent Expense
No. 729
Date
Explanation
Ref.
Debit
Credit
Balance
General Ledger
Cash
No. 101
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 1
Balance
$ 37,150
Accounts Receivable
No. 112
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 1
Balance
$ 13,000
Notes Receivable
No. 115
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 1
Balance
$ 39,000
Inventory
No. 120
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 1
Balance
$ 17,795
Office Supplies
No. 125
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 1
Balance
$ 1,200
Prepaid Insurance
No. 130
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 1
Balance
$ 2,205
Explanation / Answer
Please note: The cash receipts journal, total cash Dr. is $70642 and not $70348 as given. Kindly reconfirm on the same. Thank you.
CASH RECEIPTS JOURNAL Date AccountCredited Cash Dr. Sales Discount Dr. Accounts Receivable
Cr. Sales RevenueCr. Jan. 7 V. Arnold 4000 4000 Jan. 7 I. Tan 2000 2000 Jan. 10 Sales revenue 15500 15500 Jan. 13 M. Knast 4998 102 5100 Jan. 13 C. Ryder 1862 38 1900 Jan. 20 Sales revenue 20100 20100 Jan. 21 V. Arnold 882 18 900 Jan. 31 Sales revenue 21300 21300 Jan. 31 Totals 70642 158 13900 56900
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