Key Accounting Principles Volume 1, 4th Edition - Textbook - page 284

284
Review Exercise
Lin-Z is an owner-operated office furniture retailer. Lin-Z uses the periodic inventory system.
The following is a list of transactions for the month of June.
Jun 4 Received $4,000 from a cash sale to Gus Van Sand (sold office furniture costing $2,015).
Jun 5 Lin-Z received a bill (Invoice #4053) for $100 worth of supplies from Stapl-EZ Inc.
Jun 6 Received $480 from Bo Didley regarding outstanding accounts receivable.
Jun 9 Received $2,160 for the cash sale of a lounge suite (costing $1,050) to ReetaPetita.
Jun 9 Lin-Z received a bill from Building Services Inc. (Invoice #124) for $350 for repairs and
maintenance of office building.
Jun 10 Received $25 in interest from loan to Kurt Domino.
Jun 12 Paid amount owing (Invoice #4053) to Stapl-EZ Inc. (Cheque #465).
Jun 15 Jo Jo Inc. paid back loan of $2,400.
Jun 18 Sold goods on account (Invoice #10022) to Richard Starkey, for office furniture for
$3,000 (and costing $2,000).
Jun 21 Purchased $4,000 worth of inventory from Noel’s Inc. using cheque #466.
Jun 22 Paid amount owing (Invoice #124) to Building Services Inc. for repairs (Cheque #467).
Jun 25 Paid $175 to SKG Inc. for general expenses (Cheque #468).
Jun 26 Received bill from Brick &Mortar Inc. (Invoice #404241) for $3,500 worth of inventory.
Jun 28 Sold (Invoice #10023) $5,000 worth of inventory (cost $3,700) on account to Pete Best.
Required
a) Record these transactions in the Cash Receipts, Sales, Purchases and Cash Payments Journal.
b) Post from the special journals to the accounts receivable subledger. At the end of the month,
post from the special journals to the general ledger control account. Assume the following
opening subledger balances.
• Bo Didley: $2,000 (DR)
• Richard Starkey: $1,000 (DR)
• Pete Best: $1,500 (DR)
Note that Lin-Z’s accounts receivable records consist of only these three subledgers. Assume
no entries were made directly to accounts receivable through the general journal. Reconcile the
subledger to the control account at the end of the month.
Chapter 9 Appendix
Accounting Information Systems
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