Sales related transactions using perpetual inventory system Payroll accounts and year end entries The following accounts, with the balances indicated, appear in the ledger of Garcon Co on December 1 of the current year Account No Account Name Balance 211 Salaries Payable 212 Social Security Tax Payable $9,273 213 Medicare Tax Payable 2,318 214 Employees Federal Income Tax Payable 15,455 215 Employees State Income Tax Payable 13,909 216 State Unemployment Tax Payable 1,400 217 Federal Unemployment Tax Payable 500 218 Bond Deductions Payable $ 3,400 219 Medical Insurance Payable 27,000 411 Operations Salaries Expense 950,000 511 Officers Salaries Expense 600,000 512 Office Salaries Expense 150,000 519 Payroll Tax Expense 137,951 The following transactions relating to payroll, payroll deductions, and payroll taxes occurred during December On page 10 of the journal Dec 2 Issued Check No 410 for $3,400 to Jay Bank to purchase U S savings bonds for employees 2 Issued Check No 411 to Jay Bank for $27,046 in payment of $9,273 of social security tax, $2,318 of Medicare tax, and $15,455 of employees federal income tax due 13 Journalized the entry to record the biweekly payroll A summary of the payroll record follows Salary distribution Operations $43,200 Officers 27,200 Office 6,800 $77,200 Deductions Social security tax $ 4,632 Medicare tax 1,158 Federal income tax withheld 15,440 State income tax withheld 3,474 Savings bond deductions 1,700 Medical insurance deductions 4,500 30,904 Net amount $46,296 13 Issued Check No 420 in payment of the net amount of the biweekly payroll 13 Journalized the entry to record payroll taxes on employees earnings of December 13 social security tax, $4,632 Medicare tax, $1,158 state unemployment tax, $350 federal unemployment tax, $125 16 Issued Check No 424 to Jay Bank for $27,020, in payment of $9,264 of social security tax, $2,316 of Medicare tax, and $15,440 of employees federal income tax due 19 Issued Check No 429 to Sims Walker Insurance Company for $31,500 in payment of the semiannual premium on the group medical insurance policy On page 11 of the journal Dec 27 Journalized the entry to record the biweekly payroll A summary of the payroll record follows Salary distribution Operations $42,800 Officers 28,000 Office 7,000 $77,800 Deductions Social security tax $ 4,668 Medicare tax 1,167 Federal income tax withheld 15,404 State income tax withheld 3,501 Savings bond deductions 1,700 26,440 Net amount $51,360 27 Issued Check No 541 in payment of the net amount of the biweekly payroll 27 Journalized the entry to record payroll taxes on employees earnings of December 27 social security tax, $4,668 Medicare tax, $1,167 state unemployment tax, $225 federal unemployment tax, $75 27 Issued Check No 543 for $20,884 to State Department of Revenue in payment of employees state income tax due on December 31 31 Issued Check No 545 to Jay Bank for $3,400 to purchase U S savings bonds for employees 31 Paid $45,000 to the employee pension plan The annual pension cost is $60,000 (Record both the payment and unfunded pension liability ) Required 1 Journalize the transactions on pages 10 and 11 of the journal Refer to the Chart of Accounts for exact wording of account titles 2 On page 12 of the journal, journalize the following adjusting entries on December 31 (refer to the Chart of Accounts for exact wording of account titles) a Salaries accrued operations salaries, $8,560 officers salaries, $5,600 office salaries, $1,400 The payroll taxes are immaterial and are not accrued b Vacation pay, $15,000 1 Journalize the transactions on pages 10 and 11 of the journal Refer to the Chart of Accounts for exact wording of account titles Scroll down to access pages 11 and 12 of the journal PAGE 10 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST REF DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 PAGE 11 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST REF DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 2 On page 12 of the journal, journalize the following adjusting entries on December 31 (refer to the Chart of Accounts for exact wording of account titles) a Salaries accrued operations salaries, $8,560 officers salaries, $5,600 office salaries, $1,400 The payroll taxes are immaterial and are not accrued b Vacation pay, $15,000 PAGE 12 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST REF DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 Adjusting Entries 2 3 4 5 6 7 The following selected transactions were completed by Amsterdam Supply Co , which sells office supplies primarily to wholesalers and occasionally to retail customers Also note that the company uses a clearing house to take care of all bank as well as non bank credit cards used by its customers Record on page 10 of the journal Mar 2 Sold merchandise on account to Equinox Co , $18,900, terms FOB destination, 1 10, n 30 The cost of the goods sold was $13,300 3 Sold merchandise for $11,350 plus 6 sales tax to retail cash customers The cost of the goods sold was $7,000 4 Sold merchandise on account to Empire Co , $55,400, terms FOB shipping point, n eom The cost of the goods sold was $33,200 5 Sold merchandise for $30,000 plus 6 sales tax to retail customers who used MasterCard The cost of the goods sold was $19,400 12 Received check for amount due from Equinox Co for sale on March 2 14 Sold merchandise to customers who used American Express cards, $13,700 The cost of the goods sold was $8,350 16 Sold merchandise on account to Targhee Co , $27,500, terms FOB shipping point, 1 10, n 30 The cost of the goods sold was $16,000 18 Issued credit memo for $4,800 to Targhee Co for merchandise returned from sale on March 16 The cost of the merchandise returned was $2,900 Record on page 11 of the journal Mar 19 Sold merchandise on account to Vista Co , $8,250, terms FOB shipping point, 2 10, n 30 Added $75 to the invoice for prepaid freight The cost of the goods sold was $5,000 26 Received check for amount due from Targhee Co for sale on March 16 less credit memo of March 18 28 Received check for amount due from Vista Co for sale of March 19 31 Received check for amount due from Empire Co for sale of March 4 31 Paid Fleetwood Delivery Service $5,600 for merchandise delivered during March to customers under shipping terms of FOB destination Apr 3 Paid City Bank $940 for service fees for handling MasterCard and American Express sales during March 15 Paid $6,544 to state sales tax division for taxes owed on sales Journalize the entries to record the transactions of Amsterdam Supply Co Refer to the Chart of Accounts for exact wording of account titles Journalize the entries to record the transactions of Amsterdam Supply Co Refer to the Chart of Accounts for exact wording of account titles All transactions on this page must be entered (except for post ref(s)) before you will receive Check My Work feedback PAGE 10 JOURNAL ACCOUNTING EQUATION Score 116 400 DATE DESCRIPTION POST REF DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 Points 22 91 79 Question not attempted PAGE 11 JOURNAL ACCOUNTING EQUATION Score 0 226 DATE DESCRIPTION POST REF DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 Points 0 45 Check My Work Journalize these transactions from the seller's perspective using the perpetual inventory system Discounts are given on the amount owed by the buyer, except for any freight costs Mar 2 Note that FOB destination freight is the seller's expense Often freight must be prepaid for the carrier to deliver Discounts are given on the amount owed by the buyer, except for any freight costs Keep in mind that two entries are required for this transaction (1) for the sale on account and (2) for the cost of the merchandise sold (expense) and inventory reduction on the seller's records Mar 3 The sales tax liability is incurred at the time of sale It is debited when the seller pays the tax to the state The amount due from the buyer is the sales amount plus the sales tax Two entries are required (1) for the sale including sales tax and (2) for the cost of the merchandise sold and inventory decrease on the seller's records Mar 4 Note that FOB shipping point freight is the buyer's expense Often freight must be prepaid for the carrier to deliver Two entries are required (1) for the sale on account and (2) for the cost of the merchandise sold and inventory decrease on the seller's records Mar 5 The sales tax liability is incurred at the time of sale It is debited when the seller pays the tax to the state The amount due from the buyer is the sales amount plus the sales tax Remember that credit card transactions are recorded as cash sales Two entries are required (1) for the sale including sales tax and (2) for the cost of the merchandise sold and inventory decrease on the seller's records Mar 12 Since the invoice was paid within the discount period, the seller credits Accounts Receivable for the balance in the account, while debiting Cash for the difference between the invoice and the discount Mar 14 Remember that credit card transactions are recorded as cash sales Two entries are required (1) for the sale and (2) for the cost of the merchandise sold and inventory decrease on the seller's records Mar 16 Note that FOB shipping point freight is the buyer's expense Often freight must be prepaid for the carrier to deliver Two entries are required (1) for the sale on account and (2) for the cost of the merchandise sold and inventory decrease on the seller's records Mar 18 Customer Refunds Payable is debited while the credit is applied to the buyer's Account Receivable A second entry increases Inventory and credits Estimated Returns Inventory for the return cost Mar 19 Note that FOB shipping point freight is the buyer's expense Often freight must be prepaid for the carrier to deliver, so credit cash for the added freight Three entries are required (1) for the sale on account, (2) for the prepaid freight added to the invoice, and (3) for the cost of the merchandise sold and inventory decrease on the seller's records Mar 26 The return of merchandise reduces the original invoice amount paid by the buyer Mar 28 Since no discount is given on freight, the seller credits Accounts Receivable for the balance in the account, while debiting Cash for the invoice amount less the discount amount, plus the prepaid freight Mar 31 Since no discounts are allowed, no discounts are recorded The cash paid on account is equal to the invoice Mar 31 FOB shipping point freight is the buyer's cost, while FOB destination freight is the seller's expense Often freight must be prepaid for the carrier to deliver Apr 3 Record the service fee as an expense Apr 15 Since all sales taxes from customer transactions are recorded as a liability, Sales Tax Payable must be debited when they are paid to the state in cash

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Sales-related transactions using perpetual inventory system Payroll accounts and year-end entries The following accounts, with the balances indicated, appear in the ledger of Garcon Co.

Sales-related transactions using perpetual inventory system

Payroll accounts and year-end entries

The following accounts, with the balances indicated, appear in the ledger of Garcon Co. on December 1 of the current year:

Account No.	Account Name	Balance
211	Salaries Payable
212	Social Security Tax Payable	$9,273
213	Medicare Tax Payable	2,318
214	Employees Federal Income Tax Payable	15,455
215	Employees State Income Tax Payable	13,909
216	State Unemployment Tax Payable	1,400
217	Federal Unemployment Tax Payable	500
218	Bond Deductions Payable	$ 3,400
219	Medical Insurance Payable	27,000
411	Operations Salaries Expense	950,000
511	Officers Salaries Expense	600,000
512	Office Salaries Expense	150,000
519	Payroll Tax Expense	137,951

The following transactions relating to payroll, payroll deductions, and payroll taxes occurred during December:

On page 10 of the journal:

Dec.	2	Issued Check No. 410 for $3,400 to Jay Bank to purchase U.S. savings bonds for employees.
	2	Issued Check No. 411 to Jay Bank for $27,046 in payment of $9,273 of social security tax, $2,318 of Medicare tax, and $15,455 of employees federal income tax due.
	13	Journalized the entry to record the biweekly payroll. A summary of the payroll record follows:

Salary distribution:
Operations	$43,200
Officers	27,200
Office	6,800	$77,200
Deductions:
Social security tax	$ 4,632
Medicare tax	1,158
Federal income tax withheld	15,440
State income tax withheld	3,474
Savings bond deductions	1,700
Medical insurance deductions	4,500	30,904
Net amount		$46,296

	13	Issued Check No. 420 in payment of the net amount of the biweekly payroll.
	13	Journalized the entry to record payroll taxes on employees earnings of December 13: social security tax, $4,632; Medicare tax, $1,158; state unemployment tax, $350; federal unemployment tax, $125.
	16	Issued Check No. 424 to Jay Bank for $27,020, in payment of $9,264 of social security tax, $2,316 of Medicare tax, and $15,440 of employees federal income tax due.
	19	Issued Check No. 429 to Sims-Walker Insurance Company for $31,500 in payment of the semiannual premium on the group medical insurance policy.

On page 11 of the journal:

Dec.

Journalized the entry to record the biweekly payroll. A summary of the payroll record follows:

Salary distribution:
Operations	$42,800
Officers	28,000
Office	7,000	$77,800
Deductions:
Social security tax	$ 4,668
Medicare tax	1,167
Federal income tax withheld	15,404
State income tax withheld	3,501
Savings bond deductions	1,700	26,440
Net amount		$51,360

	27	Issued Check No. 541 in payment of the net amount of the biweekly payroll.
	27	Journalized the entry to record payroll taxes on employees earnings of December 27: social security tax, $4,668; Medicare tax, $1,167; state unemployment tax, $225; federal unemployment tax, $75.
	27	Issued Check No. 543 for $20,884 to State Department of Revenue in payment of employees state income tax due on December 31.
	31	Issued Check No. 545 to Jay Bank for $3,400 to purchase U.S. savings bonds for employees.
	31	Paid $45,000 to the employee pension plan. The annual pension cost is $60,000. (Record both the payment and unfunded pension liability.)

Required:

Journalize the transactions on pages 10 and 11 of the journal. Refer to the Chart of Accounts for exact wording of account titles.

On page 12 of the journal, journalize the following adjusting entries on December 31 (refer to the Chart of Accounts for exact wording of account titles):

	a. Salaries accrued: operations salaries, $8,560; officers salaries, $5,600; office salaries, $1,400. The payroll taxes are immaterial and are not accrued.
	b. Vacation pay, $15,000.

1. Journalize the transactions on pages 10 and 11 of the journal. Refer to the Chart of Accounts for exact wording of account titles. Scroll down to access pages 11 and 12 of the journal.

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On page 12 of the journal, journalize the following adjusting entries on December 31 (refer to the Chart of Accounts for exact wording of account titles):

	a. Salaries accrued: operations salaries, $8,560; officers salaries, $5,600; office salaries, $1,400. The payroll taxes are immaterial and are not accrued.
	b. Vacation pay, $15,000.

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	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT	ASSETS	LIABILITIES	EQUITY
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The following selected transactions were completed by Amsterdam Supply Co., which sells office supplies primarily to wholesalers and occasionally to retail customers. Also note that the company uses a clearing house to take care of all bank as well as non-bank credit cards used by its customers.

Record on page 10 of the journal

Mar.	2	Sold merchandise on account to Equinox Co., $18,900, terms FOB destination, 1/10, n/30. The cost of the goods sold was $13,300.
	3	Sold merchandise for $11,350 plus 6% sales tax to retail cash customers. The cost of the goods sold was $7,000.
	4	Sold merchandise on account to Empire Co., $55,400, terms FOB shipping point, n/eom. The cost of the goods sold was $33,200.
	5	Sold merchandise for $30,000 plus 6% sales tax to retail customers who used MasterCard. The cost of the goods sold was $19,400.
	12	Received check for amount due from Equinox Co. for sale on March 2.
	14	Sold merchandise to customers who used American Express cards, $13,700. The cost of the goods sold was $8,350.
	16	Sold merchandise on account to Targhee Co., $27,500, terms FOB shipping point, 1/10, n/30. The cost of the goods sold was $16,000.
	18	Issued credit memo for $4,800 to Targhee Co. for merchandise returned from sale on March 16. The cost of the merchandise returned was $2,900.

Record on page 11 of the journal

Mar.	19	Sold merchandise on account to Vista Co., $8,250, terms FOB shipping point, 2/10, n/30. Added $75 to the invoice for prepaid freight. The cost of the goods sold was $5,000.
	26	Received check for amount due from Targhee Co. for sale on March 16 less credit memo of March 18.
	28	Received check for amount due from Vista Co. for sale of March 19.
	31	Received check for amount due from Empire Co. for sale of March 4.
	31	Paid Fleetwood Delivery Service $5,600 for merchandise delivered during March to customers under shipping terms of FOB destination.
Apr.	3	Paid City Bank $940 for service fees for handling MasterCard and American Express sales during March.
	15	Paid $6,544 to state sales tax division for taxes owed on sales.

Journalize the entries to record the transactions of Amsterdam Supply Co. Refer to the Chart of Accounts for exact wording of account titles.

All transactions on this page must be entered (except for post ref(s)) before you will receive Check My Work feedback.

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Score: 116/400

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Points:

22.91 / 79

Question not attempted.

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Score: 0/226

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Points:

0 / 45

Check My Work

Journalize these transactions from the seller's perspective using the perpetual inventory system. Discounts are given on the amount owed by the buyer, except for any freight costs.

Mar. 2: Note that FOB destination freight is the seller's expense. Often freight must be prepaid for the carrier to deliver. Discounts are given on the amount owed by the buyer, except for any freight costs. Keep in mind that two entries are required for this transaction: (1) for the sale on account and (2) for the cost of the merchandise sold (expense) and inventory reduction on the seller's records.

Mar. 3: The sales tax liability is incurred at the time of sale. It is debited when the seller pays the tax to the state. The amount due from the buyer is the sales amount plus the sales tax. Two entries are required: (1) for the sale including sales tax and (2) for the cost of the merchandise sold and inventory decrease on the seller's records.

Mar. 4: Note that FOB shipping point freight is the buyer's expense. Often freight must be prepaid for the carrier to deliver. Two entries are required: (1) for the sale on account and (2) for the cost of the merchandise sold and inventory decrease on the seller's records.

Mar. 5: The sales tax liability is incurred at the time of sale. It is debited when the seller pays the tax to the state. The amount due from the buyer is the sales amount plus the sales tax. Remember that credit card transactions are recorded as cash sales. Two entries are required: (1) for the sale including sales tax and (2) for the cost of the merchandise sold and inventory decrease on the seller's records.

Mar. 12: Since the invoice was paid within the discount period, the seller credits Accounts Receivable for the balance in the account, while debiting Cash for the difference between the invoice and the discount.

Mar. 14: Remember that credit card transactions are recorded as cash sales. Two entries are required: (1) for the sale and (2) for the cost of the merchandise sold and inventory decrease on the seller's records.

Mar. 16: Note that FOB shipping point freight is the buyer's expense. Often freight must be prepaid for the carrier to deliver. Two entries are required: (1) for the sale on account and (2) for the cost of the merchandise sold and inventory decrease on the seller's records.

Mar. 18: Customer Refunds Payable is debited while the credit is applied to the buyer's Account Receivable. A second entry increases Inventory and credits Estimated Returns Inventory for the return cost.

Mar. 19: Note that FOB shipping point freight is the buyer's expense. Often freight must be prepaid for the carrier to deliver, so credit cash for the added freight. Three entries are required: (1) for the sale on account, (2) for the prepaid freight added to the invoice, and (3) for the cost of the merchandise sold and inventory decrease on the seller's records.

Mar. 26: The return of merchandise reduces the original invoice amount paid by the buyer.

Mar. 28: Since no discount is given on freight, the seller credits Accounts Receivable for the balance in the account, while debiting Cash for the invoice amount less the discount amount, plus the prepaid freight.

Mar. 31: Since no discounts are allowed, no discounts are recorded. The cash paid on account is equal to the invoice.

Mar. 31: FOB shipping point freight is the buyer's cost, while FOB destination freight is the seller's expense. Often freight must be prepaid for the carrier to deliver.

Apr. 3: Record the service fee as an expense.

Apr. 15: Since all sales taxes from customer transactions are recorded as a liability, Sales Tax Payable must be debited when they are paid to the state in cash.