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Comprehensive Problem 2 Part 1 and Part 2: Palisade Creek Co. is a merchandising business that...

Comprehensive Problem 2

Part 1 and Part 2:

Palisade Creek Co. is a merchandising business that uses the perpetual inventory system. The account balances for Palisade Creek Co. as of May 1, 20Y7 (unless otherwise indicated), are as follows:

110 Cash $83,600
112 Accounts Receivable 233,900
115 Merchandise Inventory 652,400
117 Prepaid Insurance 16,800
118 Store Supplies 11,400
123 Store Equipment 569,500
124 Accumulated Depreciation—Store Equipment 56,700
210 Accounts Payable 96,600
211 Customer Refunds Payable 50,000
212 Salaries Payable —
310 Lynn Tolley, Capital, June 1, 20Y6 685,300
311 Lynn Tolley, Drawing 135,000
410 Sales 5,069,000
510 Cost of Merchandise Sold 2,823,000
520 Sales Salaries Expense 664,800
521 Advertising Expense 281,000
522 Depreciation Expense —
523 Store Supplies Expense —
529 Miscellaneous Selling Expense 12,600
530 Office Salaries Expense 382,100
531 Rent Expense 83,700
532 Insurance Expense —
539 Miscellaneous Administrative Expense 7,800

Part 1: Using the attached spreadsheet, journalize the transactions for May, the last month of the fiscal year, below.

Part 2: Post the journal to the general ledger you created in Part 1, extending the month-end balances to the appropriate balance columns after all posting is completed. In this problem, you are not required to update or post to the accounts receivable and accounts payable subsidiary ledgers.

If an amount box does not require an entry, leave it blank.

May 1: Paid rent for May, $5,000.

Description Post. Ref. Debit Credit
fill in the blank 2 fill in the blank 3
fill in the blank 5 fill in the blank 6


May 3: Purchased merchandise on account from Martin Co., terms 2/10, n/30, FOB shipping point, $36,000.

Description Post. Ref. Debit Credit
fill in the blank 8 fill in the blank 9
fill in the blank 11 fill in the blank 12


May 4: Paid freight on purchase of May 3, $600.

Description Post. Ref. Debit Credit
fill in the blank 14 fill in the blank 15
fill in the blank 17 fill in the blank 18


May 6: Sold merchandise on account to Korman Co., terms 2/10, n/30, FOB shipping point, $68,500. The cost of the merchandise sold was $41,000.

Description Post. Ref. Debit Credit
fill in the blank 20 fill in the blank 21
fill in the blank 23 fill in the blank 24
fill in the blank 26 fill in the blank 27
fill in the blank 29 fill in the blank 30


May 7: Received $22,300 cash from Halstad Co. on account.

Description Post. Ref. Debit Credit
fill in the blank 32 fill in the blank 33
fill in the blank 35 fill in the blank 36


May 10: Sold merchandise for cash, $54,000. The cost of the merchandise sold was $32,000.

Description Post. Ref. Debit Credit
fill in the blank 38 fill in the blank 39
fill in the blank 41 fill in the blank 42
fill in the blank 44 fill in the blank 45
fill in the blank 47 fill in the blank 48


May 13: Paid for merchandise purchased on May 3.

Description Post. Ref. Debit Credit
fill in the blank 50 fill in the blank 51
fill in the blank 53 fill in the blank 54


May 15: Paid advertising expense for last half of May, $11,000.

Description Post. Ref. Debit Credit
fill in the blank 56 fill in the blank 57
fill in the blank 59 fill in the blank 60


May 16: Received cash from sale of May 6.

Description Post. Ref. Debit Credit
fill in the blank 62 fill in the blank 63
fill in the blank 65 fill in the blank 66


May 19: Purchased merchandise for cash, $18,700.

Description Post. Ref. Debit Credit
fill in the blank 68 fill in the blank 69
fill in the blank 71 fill in the blank 72


May 19: Paid $33,450 to Buttons Co. on account.

Description Post. Ref. Debit Credit
fill in the blank 74 fill in the blank 75
fill in the blank 77 fill in the blank 78


May 20: Paid Korman Co. a cash refund of $5,000 for damaged merchandise from sale of May 6. Korman Co. kept the merchandise.

Description Post. Ref. Debit Credit
fill in the blank 80 fill in the blank 81
fill in the blank 83 fill in the blank 84


May 20: Sold merchandise on account to Crescent Co., terms 1/10, n/30, FOB shipping point, $110,000. The cost of the merchandise sold was $70,000.

Description Post. Ref. Debit Credit
fill in the blank 86 fill in the blank 87
fill in the blank 89 fill in the blank 90
fill in the blank 92 fill in the blank 93
fill in the blank 95 fill in the blank 96


May 21: For the convenience of Crescent Co., paid freight on sale of May 20, $2,300.

Description Post. Ref. Debit Credit
fill in the blank 98 fill in the blank 99
fill in the blank 101 fill in the blank 102


May 21: Received $42,900 cash from Gee Co. on account.

Description Post. Ref. Debit Credit
fill in the blank 104 fill in the blank 105
fill in the blank 107 fill in the blank 108


May 21: Purchased merchandise on account from Osterman Co., terms 1/10, n/30, FOB destination, $88,000.

Description Post. Ref. Debit Credit
fill in the blank 110 fill in the blank 111
fill in the blank 113 fill in the blank 114


May 24: Returned damaged merchandise purchased on May 21, receiving a credit memo from the seller for $5,000.

Description Post. Ref. Debit Credit
fill in the blank 116 fill in the blank 117
fill in the blank 119 fill in the blank 120


May 26: Refunded cash on sales made for cash, $800. The defective merchandise was not returned by the customer.

Description Post. Ref. Debit Credit
fill in the blank 122 fill in the blank 123
fill in the blank 125 fill in the blank 126


May 28: Paid sales salaries of $56,000 and office salaries of $29,000.

Description Post. Ref. Debit Credit
fill in the blank 128 fill in the blank 129
fill in the blank 131 fill in the blank 132
fill in the blank 134 fill in the blank 135


May 29: Purchased store supplies for cash, $2,400.

Description Post. Ref. Debit Credit
fill in the blank 137 fill in the blank 138
fill in the blank 140 fill in the blank 141


May 30: Sold merchandise on account to Turner Co., terms 2/10, n/30, FOB shipping point, $78,750. The cost of the merchandise sold was $47,000.

Description Post. Ref. Debit Credit
fill in the blank 143 fill in the blank 144
fill in the blank 146 fill in the blank 147
fill in the blank 149 fill in the blank 150
fill in the blank 152 fill in the blank 153


May 30: Received cash from sale of May 20 plus freight paid on May 21.

Description Post. Ref. Debit Credit
fill in the blank 155 fill in the blank 156
fill in the blank 158 fill in the blank 159


May 31: Paid for purchase of May 21, less return of May 24.

Description Post. Ref. Debit Credit
fill in the blank 161 fill in the blank 162

Solutions

Expert Solution

Journal

ekkarill92 answered 2 years ago
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