Ferrara Company completes these transactions and events during March of the current year (terms of all credit sales are 2/10, n/30, terms for credit purchases vary by vendor) Mar. 1 Received $66,600 of merchandise and an invoice dated March 1, terms 2/15, 1/30, from Jerry Corp. 2 Sold merchandise on credit to N. Newman, Invoice No. 854, for $28,400 (cost is $14.400) 3 Purchased $1,960 of office supplies on credit from Elaine Company, invoice dated March 3, terms n/10 EOM. 3 Sold merchandise on credit to D. George, Invoice No. 855, for $22.000 (cost is $12.200). 6 Borrowed $138,000 cash by giving Big Bank a long-term note payable. 9 Purchased $56,100 of office equipment on credit from Susan Supply, invoice dated March 9, terms n/10 EOM. 10 Sold merchandise on credit to A. Cider, Invoice No. 856, for $13,320 (cost is $3,880). 12 Received payment from N. Newman for the March 2 sale less the discount. 13 Sent Jerry Corp Check No. 416 in payment of the March 1 invoice less the discount 13 Received payment from D. George for the March 3 sale less the discount. 14 Received $55,600 of merchandise and an invoice dated March 13, terms 2/10, n/30 from the PTK Company. 15 Issued Check No. 417. payable to Payroll, in payment of sales salaries for the first half of the month, $31,000. Cashed the check and paid the employees. 15 Cash sales for the first half of the month are $71,340 (cost is $34,040). (Cash sales are recorded daily, but are recorded only twice here to reduce repetitive entries.) 16 Purchased $2,120 of store supplies on credit from Elaine Company, invoice dated March 16, terms n/10 EOM. 17 Received a $5,560 credit memorandum from PTK Company for unsatisfactory merchandise received on March 14 and returned for credit. 19 Received a $860 credit memorandum from Susan Supply for office equipment received on March 9 and returned for credit 20 Received payment from A. Cider for the sale of March 10 less the discount. 23 Issued Check No. 418 to PTK Company in payment of the invoice of March 14 less the return and the discount. 27 Sold merchandise on credit to A. Cider, Invoice No. 857, for $22,200 (cost is $8,440) 28 Sold merchandise on credit to D. George, Invoice No. 858, for $11,100 (cost is $8,880). 31 Issued Check No. 419. payable to Payroll, in payment of sales salaries for the last half of the month, $31,000. Cashed the check and paid the employees 31 Cash sales for the last half of the month are $45,600 (cost is $21,800). 31 Verify that amounts impacting customer and creditor accounts were posted, and that any amounts that should have beed posted as individual amounts to the general ledger accounts were posted. Foot and crossfoot the journals and make the month-end postings (continued on reverse) PARTI (continued) Required: 1. Open the following general ledger accounts: Cash: Accounts Receivable: Inventory (Mar. 1, balance $50,000): Office Supplies Store Supplies; Office Equipment; Accounts Payable; Long-Term Notes Payable; W. Ferrara, Capital (Mar. 1, balance $50,000): Sales; Sales Discounts; Cost of Goods Sold; and Sales Salaries Expense. Open the following accounts receivable subsidiary ledger accounts: A Cider. N. Newman, and D. George. Open the following accounts payable subsidiary ledger Company, Jerry Corp., Susan Supply, and PTK Company. 2. Enter the March transactions in a sales journal like Exhibit 7.5 purchases journal like Exhibit 7.9 cash receipts journal like Exhibit 7.7 cash payments journal like Exhibit 7.11 general journal... (Note: daily posting are made to 1) to subsidiary ledgers, 2) individual items in the other accounts column and, 3) for all general journal entries) 3. At the end of the month, foot & cross-foot all special journal columns. Post all column totals to the general ledger, except for the other accounts columns which are posted daily. 4. Prepare a trial balance and schedules of accounts receivable and accounts payable. Date SALES JOURNAL Account Debited Nurnbe PR hearts Re Page 2 cord of God Page 2 CASH RECEIPTS JOURNAL Explanation PR Sales Decourt Dr. Account Credited Date Sales Or Cash Abouts Receivable CE Other Arts invertory Parts 1 & 2 GENERAL JOURNAL GENERAL LEDGER Cash PR Date Acct. No. 101 Balance Explanation Debit Credit Date Accounts Receivable Explanation PR Debit Acct. No. 106 Balance Credit Inventory PR Date Explanation Debit Credit Acct. No. 119 Balance Office Supplies PR Date Explanation Debit Credit Acct. No. 124 Balance Store Supplies PR Acct. No. 125 Balance Date Explanation Debit Credit Parts 1 & 2 PURCHASES JOURNAL Date of Aucts Invoice Terms PR Payable Cr Date Account Inventory Dr Office Supplies Dr Page 2 Other Accts. Dr CASH DISBURSEMENTS JOURNAL Account Debited PR Cash Cr Page 2 Aucts Pay Dr Inventory Cr O ther Accts Dr Date Ck # Payee Part 3 FERRARA COMPANY Trial Balance March 31 FERRARA COMPANY Schedule of Accounts Receivable March 31 FERRARA COMPANY Schedule of Accounts Payable March 31 Parts 1 & 2 Office Equipment Explanation PR Acct. No. 163 Balance Date Debit Credit Accounts Payable Explanation PR Debit Acct. No. 201 Balance Date Credit Long-Term Notes Payable Explanation PR Debit Acct. No. 251 Balance Date Credit W. Ferrara, Capital Explanation PR Debit Acct. No. 301 Balance Date Credit Sales PR Acct. No. 413 Balance Date Explanation Debit Credit Sales Discounts PR Date Acct. No. 415 Balance Explanation Debit Credit Cost of Goods Sold Explanation PR Debit Acct. No. 502 Balance Date Credit Sales Salaries Expense Explanation PR Debit Acct. No. 621 Balance Date Credit Parts 1 & 2 ACCOUNTS RECEIVABLE LEDGER Date A. Cider PR Explanation Debit Credit Balance N. Newman Date Explanation PR Debit Credit Balance D. George PR Date Explanation Debit Credit Balance ACCOUNTS PAYABLE LEDGER Explanation Elaine Company PR Debit Credit Balance Date Explanation Jerry Corp. PR Debit Credit Balance Susan Supply PR Debit Date Explanation Credit Balance PTK Company PR Debit Date Explanation Credit Balance