Parsons Company's chart of accounts includes the following selected accounts. 101 Cash 112 Accounts Receivable 120 Inventory

Question:

Parsons Company's chart of accounts includes the following selected accounts.

101 Cash

112 Accounts Receivable

120 Inventory

311 Common Stock

401 Sales Revenue

414 Sales Discounts

505 Cost of Goods Sold

On April 1, the accounts receivable ledger of Parsons Company showed the following balances: Park $1,550, Kolten $1,200, Hurt Co. $2,900 and Afzal $1,800. The April transactions involving the receipt of cash were as follows.

Apr. 1 Stockholders invested $7,200 additional cash in the business, in exchange for common stock.

4 Received check for payment of account from Afzal less 2% cash discount.

5 Received check for $990 in payment of invoice no. 307 from Hurt Co.

8 Made cash sales of merchandise totaling $7,845. The cost of the merchandise sold was $4,347.

10 Received check for $600 in payment of invoice no. 309 from Park.

11 Received cash refund from a supplier for damaged merchandise $680.

23 Received check for $1,500 in payment of invoice no. 310 from Hurt Co.

29 Received check for payment of account from Kolten.

Instructions

(a) Journalize the preceding transactions in a six-column cash receipts journal with columns for Cash Dr., Sales Discounts Dr., Accounts Receivable Cr., Sales Revenue Cr., Other Accounts Cr., and Cost of Goods Sold Dr./Inventory Cr. Foot and crossfoot the journal.

(b) Insert the beginning balances in the Accounts Receivable control and subsidiary accounts, and post the April transactions to these accounts.

Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...