Question 2

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Test #3 Chapters 5 & 6 Calculator Revenue and Cash Receipts Journals Lasting Summer Inc. has $1,950 in the October 1 balance of the accounts receivable account consisting of $900 from Champion Co. and $1,050 from Wayfarer Co. Transactions related to revenue and cash receipts completed by Lasting Summer Inc. during the month of October 20YS are as follows: Oct. 3. Issued Invoice No. 622 for services provided to Palace Corp., $2,050. Received cash from Champion Co., on account, for $900. 5. Issued Invoice No. 623 for services provided to Sunny Style Inc., $3,530. 8. Received cash from Wayfarer Co., on account, for $1,050. 12. Issued Invoice No. 624 for services provided to Amex Services Inc., $2,480 18. Received cash from Palace Corp, for Invoice No. 622 of October 3. 23. Issued Invoice No. 625 to Wayfarer Co., on account, for $2,090 28. Received cash from Rogers Co. for services provided, $80. 30. a. Prepare a single-column revenue journal to record these transactions. Enter transactions in chronological order. REVENUE JOURNAL PAGE 19 Accounts Rec. Dr. Invoice No. DATE Account Debited Post. Ref. Fees Earned Cr. 20YS Total Prepare a cash receipts journal to record these transactions. If an amount box does not require an entry, leave it blank. CASH RECEIPTS JOURNAL PAGE 25 DATE Account Credited Post. Ref. Fees Earned Cr. Accounts Rec. Cr. Cash Dr. 205 Total Oct. 31 b. Prepare a listing of the accounts receivable customer balances and verify that the total of the accounts receivable customer balances equals the balance accounts receivable controlling account on October 31, 20YS Lasting Summer Inc. Accounts Receivable Customer Balances October 31, 20YS Amex Services Inc. Sunny Style Inc. Wayfarer Co. Total accounts receivable c. Lasting Summer Inc. uses a subsidiary ledger for accounts receivable for all of the following reasons EXCEPT To track customer services provided on account by customer. To eliminate the need for an accounts receivable controlling account. To know who owes how much for services rendered. To manage collections from individual customers. vable