CHAPTER 8 REVIEW, PRACTICE, AND APPLY Learning Objectives 2, 3, 4, 5, 6 Problem 8-5A Check Figure Objective: To complete a comprehensive problem using five journals and three Ending balance of Accounts ledgers Receivable = $1,350; The following transactions were completed by Pendleton Fo Ending balance of Accounts October 20X1. All credit sales carry terms of 2/10.n/30. (Note: Read any during ayable = $12,230 the problem before journalizing and posting the October transactions.) . WY JuMal 20X1 Oct. 1 Paid October rent, $1,500. Received the balance of Bill Fahey's account, less a 2% discount. 2 Paid for radio advertising, $1,080. 6? 3 ss a-2% discount.ep 3 Received the balance of Brad Craven's account, less a 20 Sold merchandise on account to Hardy's Food World, $3,900. 5 3 Purchased office equipment for cash, $3,100." CO Paid S. Sanchez Co. for the October 1 balance; no discount. C 6 Made the following credit purchases from S. Sanchez Co.: store supplies, $450; office supplies, $220; and merchandise, $1,060; terms, n/30. 6 Sold merchandise on account to Southside Grocery, $2,600. 7 Recorded cash sales for the week, $4,690. 7 Purchased merchandise on account from Belk's, $8,000; terms, 1/10,n/30.? 7 Paid Zachary Products Co. for the October 1 balance, less a 2% discount. 8 Due to damage during shipment, the following items were returned for credit to S. Sanchez Co.; office supplies, $20; store s merchandise, $60. Dobil nce pots Te er ic supplies, $40; and 8 Paid Belk's for the October 1 balance, less a 2% discount. 9 Issued a check to a cash customer for the return of damaged merchandise, $85. 9 Purchased store equipment on account from Baker Supply Co., $6,620; terms, 2/10,n/30. 10 / Received the balance owed by Adams Co., less a 2% discount. 13 Received payment from Hardy's Food World for the sale of October 3. ( 13 Recorded cash sales for the week, $6,010. 15 Faid salaries for the first half of the month, $2, 100.C? 16 Received paymen payment from Southside Grocery for the sale of October 6. 17 Paid Belk's the amount due on the purchase of October 7. 18 Purchased merchandise on account from Engel Co., $3,600; terms, ? 2/10,n/30. 19 Returned defective merchandise to Engel Co. and received credit, $350.G 21 Purchased merchandise for cash, $1,000. allM soccer2 22 Sold at cost a computer printer that was no longer needed, $1,500. ( 22 Recorded cash sales for the week, $6,495. did win2 bn. 23 Paid for miscellaneous expenses, $225. 25 Paid for repairs to delivery truck, $250. 26 Paid gas and oil expense, $125. route sogbol olda 27 Purchased merchandise on account from Belk's, $4,000. ? by elsros rims 28 Paid Engel Co. for the purchase of October 18, less the return of October 19.0 oils or lamuo 30 Sold merchandise on account to Southside Grocery, $1,350. 31 Recorded cash sales for the week, $9,600. 31 Paid salaries for the second half of the month, $2,200. Q 31 Paid utility bill, $872. QDirections :" 1. Open the following accounts in the and lodge. and at the baland October 1 :1 717 Account ances as Of 112 Cash 113 Accounts Place* $ 8.300| 114 Store Supplies 19.500 121 Office Supplies 3.500| 122 Store Equipment 211 Office Equipment 18730 411 ACCOUNTS Payable 471. 1 Sales 18.700 471.2 Sales Returns and Allowances 1 18.400 511 Sales Discounts 3:300 511 . 1 Purchases\\ 3. 040 511.2 Purchases Returns and Allowances 48.700 5,400 611 Purchases Discounts 3.000 612 Rent Expense Salaries Expense 3.750 613 38.700 614 Utilities Expense Repairs Expense 7,800 615 616 Advertising Expense 3.200 618 Gas and Oil Expense 1.500 Miscellaneous Expenses 806 Open the following accounts in the accounts receivable ledger , and enter the balances as of October 1 :` Account Balance Adams CO $4, 100 Brad Craven 4. 500 90 Bill Fahey 2.900 58 Hardy's Food World - 0- Southside Grocery - 0 - 3 . Open the following accounts in the accounts payable ledger , and enter the balances as of October 1 :` Account Balance Baker Supply CO. 5 - 0 - Belk's 6. 500 Engel CO . - O - S. Sanchez CO . 4 , 300 8. 900 17.8 Zachary Products CO. 4 . Record the October transactions using a sales journal ( page S ), a cash receipts journal ( page 7 ) , a purchases journal ( page 14 ) , a cash payments journal ( page 10 ). and a general journal ( page 5 ) . Post to the subsidiary ledgers after each entry . Start sales invoices with No. 377 , purchases invoices with No. 364 , and checks with No 419 . Remember that all credit sales carry terms of 2/10. 12/30 . 5. Post the individual entries from the general journal to the general ledger . Total. rule , and post the special journals . 6 . Prepare schedules of accounts receivable and accounts payable, and verify, the corals . 377 Chapter 8 | Accounting for a Merchandising Business