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Comprehensive Problem 2 Part 1 and Part 2: Palisade Creek Co. is a merchandising business that uses the perpetual inventory system. The account balances for

Comprehensive Problem 2 Part 1 and Part 2: Palisade Creek Co. is a merchandising business that uses the perpetual inventory system. The account balances for Palisade Creek Co. as of May 1, 20Y7 (unless otherwise indicated), are as follows: 110 Cash $83,600 112 Accounts Receivable 233,900 115 Merchandise Inventory 652,400 117 Prepaid Insurance 16,800 118 Store Supplies 11,400 123 Store Equipment 569,500 124 Accumulated DepreciationStore Equipment 56,700 210 Accounts Payable 96,600 211 Customer Refunds Payable 50,000 212 Salaries Payable 310 Lynn Tolley, Capital, June 1, 20Y6 685,300 311 Lynn Tolley, Drawing 135,000 410 Sales 5,069,000 510 Cost of Merchandise Sold 2,823,000 520 Sales Salaries Expense 664,800 521 Advertising Expense 281,000 522 Depreciation Expense 523 Store Supplies Expense 529 Miscellaneous Selling Expense 12,600 530 Office Salaries Expense 382,100 531 Rent Expense 83,700 532 Insurance Expense 539 Miscellaneous Administrative Expense 7,800 Part 1: Journalize the transactions for May, the last month of the fiscal year, below. Part 2: Using the attached spreadsheet as your general ledger, post the journal entries you created in Part 1 to the general ledger, extending the month-end balances to the appropriate balance columns after all posting is completed. In this problem, you are not required to update or post to the accounts receivable and accounts payable subsidiary ledgers. Please be sure to save the spreadsheet general ledger to use for the remaining parts of this comprehensive problem. If an amount box does not require an entry, leave it blank. May 1: Paid rent for May, $5,000. Description Post. Ref. Debit Credit Rent Expense fill in the blank 2 5,000 fill in the blank 3 Cash fill in the blank 5 fill in the blank 6 5,000 May 3: Purchased merchandise on account from Martin Co., terms 2/10, n/30, FOB shipping point, $36,000. Description Post. Ref. Debit Credit Merchandise Inventory fill in the blank 8 36,000 fill in the blank 9 Accounts Payable-Martin Co. fill in the blank 11 fill in the blank 12 36,000 May 4: Paid freight on purchase of May 3, $600. Description Post. Ref. Debit Credit Merchandise Inventory fill in the blank 14 600 fill in the blank 15 Cash fill in the blank 17 fill in the blank 18 600 May 6: Sold merchandise on account to Korman Co., terms 2/10, n/30, FOB shipping point, $68,500. The cost of the merchandise sold was $41,000. Description Post. Ref. Debit Credit fill in the blank 20 fill in the blank 21 fill in the blank 23 fill in the blank 24 fill in the blank 26 fill in the blank 27 fill in the blank 29 fill in the blank 30 May 7: Received $22,300 cash from Halstad Co. on account. Description Post. Ref. Debit Credit Cash fill in the blank 32 22,300 fill in the blank 33 Accounts Receivable-Halstad Co. fill in the blank 35 fill in the blank 36 22,300 May 10: Sold merchandise for cash, $54,000. The cost of the merchandise sold was $32,000. Description Post. Ref. Debit Credit fill in the blank 38 fill in the blank 39 fill in the blank 41 fill in the blank 42 fill in the blank 44 fill in the blank 45 fill in the blank 47 fill in the blank 48 May 13: Paid for merchandise purchased on May 3. Description Post. Ref. Debit Credit Merchandise Inventory fill in the blank 50 32,000 fill in the blank 51 Cost of Merchandise Sold fill in the blank 53 fill in the blank 54 32,000 May 15: Paid advertising expense for last half of May, $11,000. Description Post. Ref. Debit Credit Advertising Expense fill in the blank 56 11,000 fill in the blank 57 Cash fill in the blank 59 fill in the blank 60 11,000 May 16: Received cash from sale of May 6. Description Post. Ref. Debit Credit Cash fill in the blank 62 67,130 fill in the blank 63 Accounts Receivable-Korman Co. fill in the blank 65 fill in the blank 66 67,130 May 19: Purchased merchandise for cash, $18,700. Description Post. Ref. Debit Credit Merchandise Inventory fill in the blank 68 18,700 fill in the blank 69 Cash fill in the blank 71 fill in the blank 72 18,700 May 19: Paid $33,450 to Buttons Co. on account. Description Post. Ref. Debit Credit Accounts Payable-Buttons Co. fill in the blank 74 33,450 fill in the blank 75 Cash fill in the blank 77 fill in the blank 78 33,450 May 20: Paid Korman Co. a cash refund of $5,000 for damaged merchandise from sale of May 6. Korman Co. kept the merchandise. Description Post. Ref. Debit Credit Customer Refund Payable fill in the blank 80 5,000 fill in the blank 81 Cash fill in the blank 83 fill in the blank 84 5,000 May 20: Sold merchandise on account to Crescent Co., terms 1/10, n/30, FOB shipping point, $110,000. The cost of the merchandise sold was $70,000. Description Post. Ref. Debit Credit fill in the blank 86 fill in the blank 87 fill in the blank 89 fill in the blank 90 fill in the blank 92 fill in the blank 93 fill in the blank 95 fill in the blank 96 May 21: For the convenience of Crescent Co., paid freight on sale of May 20, $2,300. Description Post. Ref. Debit Credit Accounts Receivable-Crescent Co. fill in the blank 98 2,300 fill in the blank 99 Cash fill in the blank 101 fill in the blank 102 2,300 May 21: Received $42,900 cash from Gee Co. on account. Description Post. Ref. Debit Credit Cash fill in the blank 104 42,900 fill in the blank 105 Accounts Receivable-Gee Co. fill in the blank 107 fill in the blank 108 42,900 May 21: Purchased merchandise on account from Osterman Co., terms 1/10, n/30, FOB destination, $88,000. Description Post. Ref. Debit Credit Merchandise Inventory fill in the blank 110 88,000 fill in the blank 111 Accounts Payable-Osterman Co. fill in the blank 113 fill in the blank 114 88,000 May 24: Returned damaged merchandise purchased on May 21, receiving a credit memo from the seller for $5,000. Description Post. Ref. Debit Credit Accounts Payable-Osterman Co. fill in the blank 116 5,000 fill in the blank 117 Merchandise Inventory fill in the blank 119 fill in the blank 120 5,000 May 26: Refunded cash on sales made for cash, $800. The defective merchandise was not returned by the customer. Description Post. Ref. Debit Credit Customer Refund Payable fill in the blank 122 800 fill in the blank 123 Cash fill in the blank 125 fill in the blank 126 800 May 28: Paid sales salaries of $56,000 and office salaries of $29,000. Description Post. Ref. Debit Credit Sales Salaries Expense fill in the blank 128 56,000 fill in the blank 129 Office Salaries Expense fill in the blank 131 29,000 fill in the blank 132 Cash fill in the blank 134 fill in the blank 135 85,000 May 29: Purchased store supplies for cash, $2,400. Description Post. Ref. Debit Credit Store Supplies fill in the blank 137 2,400 fill in the blank 138 Cash fill in the blank 140 fill in the blank 141 2,400 May 30: Sold merchandise on account to Turner Co., terms 2/10, n/30, FOB shipping point, $78,750. The cost of the merchandise sold was $47,000. Description Post. Ref. Debit Credit fill in the blank 143 fill in the blank 144 fill in the blank 146 fill in the blank 147 fill in the blank 149 fill in the blank 150 fill in the blank 152 fill in the blank 153 May 30: Received cash from sale of May 20 plus freight paid on May 21. Description Post. Ref. Debit Credit Cash fill in the blank 155 1,112,000 fill in the blank 156 Accounts Receivable-Crescent Co. fill in the blank 158 fill in the blank 159 1,112,000 May 31: Paid for purchase of May 21, less return of May 24. Description Post. Ref. Debit Credit Accounts Payable-Osterman Co. fill in the blank 161 82,170 fill in the blank 162 Cash fill in the blank 164 fill in the blank 165 82,170

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