Presented below are the sales and cash receipts journals for Wicked Co. for its first month of…
Presented below are the sales and cash receipts journals for Wicked Co. for its first month of operations.
SALES JOURNAL
Date
Account Debited
Accounts Receivable Dr.Sales Cr.
Cost of Goods Sold Dr.
Merchandise Inventory Cr.
Feb. 3
C. Lion
4,000
2,400
9
S. Crow
5,000
3,000
12
T. Mann
6,500
3,900
26
W. Oz
5,500
3,300
21,000
12,600
CASH RECEIPTS JOURNAL
Cash
Dr.
Sales
Discounts
Dr.
Accounts
Receivable
Cr.
Sales
Cr.
Other
Accounts
Cr.
Cost of Goods Sold Dr.
Merchandise Inventory Cr.
Date
Account Credited
23,000
Feb. 1
B.Wicked, Capital
23,000
2
4,500
4,500
2,700
13
C. Lion
3,960
40
4,000
18
Merchandise Inventory
120
120
26
S. Crow
5,000
5,000
36,580
40
9,000
4,500
23,120
2,700
In addition, the following transactions have not been journalized for February 2010.
Feb. 2
Purchased merchandise on account from J. Garland for $3,600, terms 2/10, n/30.
7
Purchased merchandise on account from B. Lahr for $23,000, terms 1/10, n/30.
9
Paid cash of $980 for purchase of supplies.
12
Paid $3,528 to J. Garland in payment for $3,600 invoice, less 2% discount.
15
Purchased equipment for $5,500 cash.
16
Purchased merchandise on account from D. Gale $1,900, terms 2/10, n/30.
17
Paid $22,770 to B. Lahr in payment of $23,000 invoice, less 1% discount.
20
B.Wicked withdrew cash of $800 from business for personal use.
21
Purchased merchandise on account from Kansas Company for $6,000, terms 1/10, n/30.
28
Paid $1,900 to D. Gale in payment of $1,900 invoice.
Instructions
(a) Open the following accounts in the general ledger.
101 Cash
120 Merchandise Inventory
112 Accounts Receivable
126 Supplies
157 Equipment
401 Sales
158 Accumulated DepreciationEquipment
414 Sales Discounts
201 Accounts Payable
505 Cost of Goods Sold
301 B.Wicked, Capital
631 Supplies Expense
306 B.Wicked, Drawing
711 Depreciation Expense
(b) Journalize the transactions that have not been journalized in a one-column purchases journal and the cash payments journal.
(c) Post to the accounts receivable and accounts payable subsidiary ledgers. Follow the sequence of transactions as shown in the problem.
(d) Post the individual entries and totals to the general ledger.
(e) Prepare a trial balance at February 28, 2010.
(f) Determine that the subsidiary ledgers agree with the control accounts in the general ledger.
(g) The following adjustments at the end of February are necessary.
(1) A count of supplies indicates that $200 is still on hand.
(2) Depreciation on equipment for February is $150.
Prepare the adjusting entries and then post the adjusting entries to the general ledger.
(h) Prepare an adjusted trial balance at February 28, 2010.
