Mike's Bike Shop

Mike's Bike Shop has the following chart of accounts:

Assets

111 Cash

113 Accounts Receivable (A/R)

114 Allowance for Doubtful Accounts 115 Merchandise Inventory

116 Prepaid Insurance

118 Supplies

121 Equipment

123 Accum. Deprec. - Equipment

Liabilities

212 Accounts Payable (A/P) 215 Salaries Payable

218 Sales Tax Payable

220 Unearned Rent

Owner's Equity

311 M. Ross, Capital

312 M. Ross, Drawing

220 Unearned Rent

Revenue

411 Sales

412 Sales Returns and Allowances 413 Sales Discounts

413 Sales Discounts

Cost of Goods Sold

511 Purchases

512 Freight In

513 Purchases Returns & Allowances 514 Purchases Discounts

Expenses

621 Salary Expense

626 Utilities Expense

627 Rent Expense

630 Depreciation Expense-Equipment

635 Bad Debt Expense

650 Miscellaneous Expense

Record the following transactions for May, using a sales journal, page 7; a purchases journal, page 9; a cash receipts journal, page 10; a cash payments journal, pay 21; and a general journal, page 12. Sales tax rate is 8%.

May

1 M Ross, the owner, invested an additional &7,500 in the business.

1 Sold merchandise on account to South River Mall Security, $1,250, invoice no. 221, terms 2/10 N30

3 Bought merchandise on account from Huffy, $2,750, invoice D873, dated May 1; terms 1/10 N30; freight prepaid and added to the invoice, $85.50. Invoices totals $2,835.50.

4 Issued check no. 1449 to pay rent for the current month, $700.

5 Received check from Danas Day Care for $396 in payment of $400 invoice from the previous month less discount.

5 Sold merchandise on account to Greensville Police Department, invoice no. 222, $1,500, terms 2/10 N30.

6 Received check from South River Mall Security, $637, in payment of $650 invoice from the previous month less discount.

7 Issued check no. 1450, $871.22, to Schwinn, Inc., in payment of invoice no. 856A for $889 from last month less discount.

9 Received check from South River Mall Security for $1,325 in payment of invoice 221 less discount.

9 Bought supplies on account from Office Max, $450, invoice no. J-345; terms Net 30 days.

10 Sold merchandise on account to Greensville Bike Club, invoice no. 223, $570, terms Net 30 days.

11 Issued credit memo no. 23 to Greensville Police Department, $175, for merchandise returned from the May 5th purchase.

15 Bought merchandise on account from Schwinn, $1,250, invoice 976H, dated May 13; terms 2/10, N30.

15 Cash sales for May 1 through May 14, $6,975.

15 Issued check no. 1451 for payroll for 1st two weeks of May, $2,500.

20 Received credit memo no. 234, $335, from Huffy for merchandise returned (May 3 purchase).

21 Issued check no. 1452, $2,500.50 to Huffy, in payment of invoice D873 less CM 234.

21 Issued check no. 1453, $99, to SBC for monthly internet service.

28 Issued check no. 1454, to Swift Shipping, $54, for freight charges on merchandise purchased on May 15.

31 Cash sales for May 15 through May 31, $3,265.

31 Issued check no. 1455, $2,85, for payroll for last two weeks of May.

31 Received check from Greensville Police Department for invoice 222, $2,620 less CM 23, $189.

31 Sold merchandise on account to Dana's Daycare, $450, invoice no. 225, terms 1/10 N30

31 M. Ross, the owner, withdrew cash for personal use, $1,500, check no 1456

Additional Instructions

1. Post all entries involving customer accounts to the accounts receivable ledger.

2. Post all entries involving creditor accounts to the accounts payable ledger.

3. Post those entries involving Other Accounts columns and the general journal to the general ledger.

4. Post the appropriate totals of the special journals to the general ledger.

5. Prepare a schedule of A/R and a schedule of A/P as of May 31, 2017.