Question

228 Chapter 7 Problem 7-5A OO The general ledger of Cannin Distributors includes the following selected accosnts, along with their account numbers Cash 11 4" Land Accounts Receivable 17 42 Sales Revene Inventory Notes Receivable 13 43 Sales Discounts 51 15 Sales Returns and Allowances Supplies 16 Cost of Goods Sold. All credit sales are on the company's standard terms of 2/10, n/30. Transactions in July that affected sales and cash receipts were as follows Jul 2 Sold inventory on credit to Fortin Inc, $2.800. Cannin's cot of these goods As a favour to a competitor, sold supplies at cost, $3,400, receiving casn- Cash sales of merchandise for the week totalled $7,560 (cost, $6,560). Sold merchandise on account to A. L. Price, $29,280 (cost, $20,440) Sold land that cost $50,000 for cash off $50,000 Sold goods on account to Sloan Forge Ltd. $20,416 (cost, $14,08). was $1,600, 4 10 11 Received cash from Fortin Inc. in fulll settiement ef its account receivable from July 2 Cash sales of merchandise for the week were $8,424 (cost, 56,120 12 14 Sold inventory on credit to the partnership of Wilkie & Blinn, $14,600 (cost, $9,040). 18 cost Cannin $1,760 Sold merchandise on account to Sloan Forge Ltd., $2.516 (cost, $1,800) 15 Received inventory sold on July 9 to A. L Price for $2,400. The goods shipped were the wrong size. These goods 20 Cash sales of merchandise for the week were $3960 (cost, $2,7660) 21 Received $8,000 cash from A. L Price in partial settlement of his account receivable. Received cash from Wilkie & Blinn for its account receivable from July 15. 22 25 25 Sold goods on account to Olsen Inc., $6,080 (cost, $4,200). Collected $10,500 on a note receivable. 27 28 Cash sales of merchandise for the week were $15,096 (cost, $9,840). Sold inventory on account to R. O. Bankston Inc., $968 (cost, $680). 29 Received goods sold on July 25 to Olsen Inc. for $160. The wrong items were shipped. The cost of the goods was $100 30 31 Received $18,880 cash on account from A. L. Price. Re Required 1. Use the appropriate journal to record the above transactions: a sales journal (omit the Invoice No. column), a cash receipts jounal, or a general journal Cannin Distributors records sales returns and allowances in the general iournal. 2. Total each column of the sales journal and the cash receipts journal. Show that total debits equal total credits. 3. Show how postings would be made from the journals by writing the account numbers and check marks in the appropriate places in the journals. 229 Accounting Information Systems Requirements 1-3 Sales Journal COST OF GOODS SOLD DR INVENTORY CR ACCOUNTS RECEIVABLE DR SALES REVENUE CR. POST REF ACCOUNTS DEBITED DATE General Journal CREDIT POST REF. DEBIT ACCOUNT TITLES AND EXPLANATIONS DATE 230 Chapter7 DHOINIANI THVAED SINTODSIC STIVS HSVD 190 Srivs SINTOTTV SINOOOOV MIHIO SIICE SLIRBC Cash Receipts Journal (panuguo) E-1 squaanbay

Answer 1

Sales Journal Cost of Goods Sold Dr Inventory Cr Accounts Receivable Post Ref Dr. Sales Revenue Cr Accounts Debited Date Fortin Inc Jul.2 2,800 1,600 Jul.9 A.I Price 29,280 20,440 Sloan Forge Ltd. Jul.11 20,416 14,080 Jul.15 Wilkie &Blinn 9,040 14,600 Jul.20 Sloan Forge Ltd. Olsen Inc R.O.Bankston Inc 2,516 1,800 Jul 25 6,080 4,200 Jul.29 968 680 76,660 51,840

General Journal Post Ref DEBIT Account Titles and Explanations Date CREDIT Jul.18 Sales Returns &Allowance 2,400 43 A.I. Price 12 2,400 (goods returned due to wrong size) Jul.30 Sales Returns &Allowance 43 160 Olsen Inc (goods returned due to wrong Items) 12 160

Cash Receipt Journal Credits Debits Other Accounts Sales Cost Of Accounts Post Ref Receivables Sales Revenue Account Title Cash Discounts Date Amount Goods Sold Jul.4 3,400 3,400 3,400 Jul.7 7,560 7,560 6,560 Jul.10 Land 50,000 18 50,000 Jul.12 2,744 8,424 56 2,800 Jul.14 8,424 6,120 Jul.21 3,960 3,960 2,760 Jul.22 8,000 8,000 Jul.25 14,308 292 14,600 Jul.27 Note receivable 10,500 15 10,500 Jul.28 15,096 15,096 9,840 Jul.28 18,880 18,880 60,500 142,872 348 44,280 38,440 28,680
# all cash transactions are recorded in cash journal

# All credit sales are recorded in sales journal