PROBLEM 3

Gupta Merchandising Company is a newly formed trading company on its first month of operations. Compute the ending balances of the accounts in the requirements below. Hint* carefully journalize and post to arrive at the correct unadjusted balances. You do not need to make adjusting entries yet because it is the first month of operations and you are not publishing financial statements yet.

Sept. 1 Received $55,000 as capital from Kishan Gupta.

Sept. 2 Bought computer equipment for cash, $500.

Sept. 3 Paid office rent in advance for one year, $4,800.

Sept. 4 Bought office furniture for cash, $2,000.

Sept. 5 Bought various merchandise for cash, $5,000.

Sept.6 Bought various merchandise on account, $8,000, terms 2/10, n/30 (gross method).

Sept.7 Sold merchandise costing, $5,000 for $8,000 cash.

Sept. 8 Sold merchandise costing $8,000 for $12,000 on account 2/10, n/30 (gross method).

Sept. 9 Bought merchandise on account $7,500, terms 2/10, n/30 (gross method).

Sept. 10 Bought merchandise on account $8,000 terms 2/10, n/30 (gross method).

Sept. 12 Paid merchandise bought on account, Sept.6

Sept. 17 Collected merchandise sold on account on Sept.8

Sept. 21 Paid merchandise bought on account on Sept. 9

Sept. 22 Sold merchandise costing $7,500 for cash $15,000

Sept. 24 Paid merchandise bought on account on Sept. 10

Sept. 25 Paid utilities for cash $300

Sept. 26 Bought merchandise on account $6000, terms 2/10, n/30

Sept. 30 Sold merchandise costing $3,000 on account for $5,000, terms, 2/10, n/30.

Compute the unadjusted ending ledger balances of the following accounts:

1. Cash

2. Accounts Receivable

3. Merchandise Inventory

4. Current Assets

5. Total Assets

6. Total Liabilities

7. Total Capital