Green Mountain Water Testing Service was established on November 16, 2012. Green Mountain uses field equipment and field supplies (chemicals and other supplies) to analyze water for unsafe contaminants in streams, lakes, and ponds. Transactions related to purchases and cash payments during the remainder of November are as follows:

Nov. 16. Issued Check No. 1 in payment of rent for the remainder of November, $1,700.

16. Purchased field supplies on account from Hydro Supply Co., $4,380.

16. Purchased field equipment on account from Test-Rite Equipment Co., $16,900.

17. Purchased office supplies on account from Best Office Supply Co., $375.

19. Issued Check No. 2 in payment of field supplies, $2,560, and office supplies, $300.

Post the journals to the accounts payable subsidiary ledger.

23. Purchased office supplies on account from Best Office Supply Co., $580.

23. Issued Check No. 3 to purchase land, $45,000.

24. Issued Check No. 4 to Hydro Supply Co. in payment of invoice, $4,380.

26. Issued Check No. 5 to Test-Rite Equipment Co. in payment of invoice, $16,900.

Post the journals to the accounts payable subsidiary ledger.

30. Acquired land in exchange for field equipment having a cost of $8,000.

30. Purchased field supplies on account from Hydro Supply Co., $5,900.

30. Issued Check No. 6 to Best Office Supply Co. in payment of invoice, $375.

30. Purchased the following from Test-Rite Equipment Co. on account: field supplies, $900, and field equipment, $3,700.

30. Issued Check No. 7 in payment of salaries, $22,400.

Post the journals to the accounts payable subsidiary ledger.

Instructions

1. Journalize the transactions for November. Use a purchases journal and a cash payments journal, similar to those illustrated in this chapter, and a two-column general journal. Use debit columns for Field Supplies, Office Supplies, and Other Accounts in the purchases journal. Refer to the following partial chart of accounts:

11 Cash

14 Field Supplies

15 Office Supplies

17 Field Equipment

19 Land

21 Accounts Payable

61 Salary Expense

71 Rent Expense

At the points indicated in the narrative of transactions, post to the following accounts in the accounts payable subsidiary ledger:

Best Office Supply Co.

Hydro Supply Co.

Test-Rite Equipment Co.

2. Post the individual entries (Other Accounts columns of the purchases journal and the cash payments journal and both columns of the general journal) to the appropriate general ledger accounts.

3. Total each of the columns of the purchases journal and the cash payments journal, and post the appropriate totals to the general ledger. (Because the problem does not include transactions related to cash receipts, the cash account in the ledger will have a credit balance.)

4. Sum the balances of the accounts payable subsidiary ledger.

5. Why might Green Mountain consider using a subsidiary ledger for the field equipment?