Chapter 5 HW: 3

Purchases, Accounts Payable Subsidiary Account, and Accounts Payable Ledger

Sterling Forest Landscaping designs and installs landscaping. The landscape designers and office staff use office supplies, while field supplies (rock, bark, etc.) are used in the actual landscaping. Purchases on account completed by Sterling Forest Landscaping during October are as follows:

Oct. 2.		Purchased office supplies on account from Meade Co., $3,180.
5.		Purchased office equipment on account from Peach Computers Co., $4,570.
9.		Purchased office supplies on account from Executive Office Supply Co., $330.
13.		Purchased field supplies on account from Yamura Co., $3,620.
14.		Purchased field supplies on account from Omni Co., $480.
17.		Purchased field supplies on account from Yamura Co., $8,610.
24.		Purchased field supplies on account from Omni Co., $2,430.
29.		Purchased office supplies on account from Executive Office Supply Co., $210.
31.		Purchased field supplies on account from Omni Co., $3,170.

Note: Posting references have been provided.

Required:

1. Insert the following balances in the general ledger as of October 1:

14	Field Supplies	$6,470
15	Office Supplies	1,490
18	Office Equipment	21,830
21	Accounts Payable	5,550

After completing the recording of transactions in part 3, post the purchases journal to the accounts in the general ledger. If an amount box does not require an entry, leave it blank.

2. Insert the following balances in the accounts payable subsidiary ledger as of October 1:

Executive Office Supply Co.	$1,830
Meade Co.	3,720
Omni Co.	-
Peach Computers Co.	-
Yamura Co.	-

After completing the recording of transactions in part 3, post to the creditor accounts in the accounts payable subsidiary ledger immediately after each entry. If an amount box does not require an entry, leave it blank.

3. Journalize the transactions for October (in chronological order), using the purchases journal below (p. 30) similar to the one illustrated in this chapter. Post to the creditor accounts in the accounts payable subsidiary ledger (in part 2) immediately after each entry.

4. Post the purchases journal to the accounts in the general ledger (in part 1). If an amount box does not require an entry, leave it blank.

If no other account is needed in the "Other Accounts Dr." column select "No entry required".

5a. What is the sum of the creditor balances in the subsidiary ledger at October 31?

5b. What is the balance of the accounts payable controlling account at October 31?

6. What type of e-commerce application would be used to plan and coordinate transactions with suppliers? (Customer relation management or supply chain management)

GENERAL LEDGER Balance Date Item Post. Ref. Debit Credit Dr. Cr. Account: Field Supplies #14 Oct. 1 Balance P30 Account: Office Supplies #15 Oct. 1 Balance = P30 Account: Office Equipment #18 Oct. 1 Balance P30 Account: Accounts Payable #21 Oct. 1 Balance P30 ACCOUNTS PAYABLE SUBSIDIARY LEDGER Date Item Post. Ref. Debit Account: Executive Office Supply Co. Credit Balance Oct. 1 Balance P30 III P30 Account: Meade Co. Oct. 1 Balance P30 Account: Omni Co. P30 Ill P30 Account: Peach Computers Co. P30 Account: Yamura Co. P30 P30 PURCHASES JOURNAL PAGE 30 Date Account Credited Post. Ref. Accounts Payable Cr. Field Supplies Dr. Office Supplies Dr. Other Accounts Dr. Post. Ref. Amount Oct. 2 Oct. 5 Oct. 9 Oct. 13 Oct. 14 Oct. 17 Oct. 24 Oct. 29 Oct. 31 Oct. 31 (v)