Question

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Church Company completes these transactions and events during March of the current year (terms for all its credit sales are 3/10, n/30).

Mar.		1			Purchased $32,000 of merchandise from Van Industries, terms 3/15, n/30.
		2			Sold merchandise on credit to Min Cho, Invoice No. 854, for $12,800 (cost is $6,400).
		3		(a)	Purchased $960 of office supplies on credit from Gabel Company, terms n/30.
		3		(b)	Sold merchandise on credit to Linda Witt, Invoice No. 855, for $6,400 (cost is $3,200).
		6			Borrowed $72,000 cash from Federal Bank by signing a long-term note payable.
		9			Purchased $16,000 of office equipment on credit from Spell Supply, terms n/30.
		10			Sold merchandise on credit to Jovita Albany, Invoice No. 856, for $3,200 (cost is $1,600).
		12			Received payment from Min Cho for the March 2 sale less the discount of $384.
		13		(a)	Sent Van Industries Check No. 416 in payment of the March 1 invoice less the discount of $960.
		13		(b)	Received payment from Linda Witt for the March 3 sale less the discount of $192.
		14			Purchased $28,000 of merchandise from the CD Company, terms 3/10, n/30.
		15		(a)	Issued Check No. 417 for $17,400, payee is Payroll, in payment of sales salaries expense for the first half of the month.
		15		(b)	Cash sales for the first half of the month are $51,200 (cost is $40,960). These cash sales are recorded in the cash receipts journal on March 15.
		16			Purchased $1,480 of store supplies on credit from Gabel Company, terms n/30.
		17			Returned $2,800 of unsatisfactory merchandise purchased on March 14 to CD Company. Church reduces accounts payable by that amount.
		19			Returned $480 of office equipment purchased on March 9 to Spell Supply. Church reduces accounts payable by that amount.
		20			Received payment from Jovita Albany for the sale of March 10 less the discount of $96.
		23			Issued Check No. 418 to CD Company in payment of the March 14 purchase less the March 17 return and the $756 discount.
		27			Sold merchandise on credit to Jovita Albany, Invoice No. 857, for $9,600 (cost is $3,840).
		28			Sold merchandise on credit to Linda Witt, Invoice No. 858, for $3,840 (cost is $1,536).
		31		(a)	Issued Check No. 419 for $17,400, payee is Payroll, in payment of sales salaries expense for the last half of the month.
		31		(b)	Cash sales for the last half of the month are $56,320 (cost is $33,792). These cash sales are recorded in the cash receipts journal on March 31.
		31		(c)	Verify that amounts impacting customer and creditor accounts were posted and that any amounts that should have been posted as individual amounts to the general ledger accounts were posted. Foot and crossfoot the journals and make the month-end postings.

Assume the following ledger account amounts Inventory (March 1 beg. bal. is $61,000), Z. Church, Capital (March 1 beg. bal. is $61,000) and Church Company uses the perpetual inventory system.

Required:
2-a. Enter the transactions in a sales journal.
2-b. Enter the transactions in a purchases journal.
2-c. Enter the transactions in a cash receipts journal.
2-d. Enter the transactions in a cash payments journal.
2-e. Enter the transactions in a general journal.

a) Post information from the journals in Part 2 to the general ledger and the accounts receivable and accounts payable subsidiary ledgers.

b) Prepare the March 31 trial balance, schedule of accounts receivable and schedule of accounts payable.

Answer 1

the question have multiple parts . please see below for solution of first four parts .

Solution :

Req 2a.

Sales Journal

Date	Customer Account	Invoice number	Account receivables Dr/ Sales Cr	Cost of goods sold Dr/ Inventory Cr.
March 2	Min Cho	854	$ 12,800	$ 6,400
March 3	Linda Witt	855	$ 6,400	$ 3,200
March 10	Jovita Albany	856	$ 3,200	$ 1,600
March 27	Jovita Albany	857	$ 9,600	$ 3,840
March 28	Linda Witt	858	$ 3,840	$ 1,536
Total			$ 35,840	$ 16,576

Req 2b.

Purchase Journal

Date	Supplier Account	Credit terms	Accounts payable Cr	Purchase Dr	Office supplies Dr	Office equipment Dr.
March 1	Van Industries	3/15, n/30	$ 32,000	$ 32,000
March 3	Gabel Company	n/30	$ 960		$ 960
March 9	Spell Supply	n/30	$ 16,000			$ 16,000
March 14	CD Company	3/10, n/30	$ 28,000	$ 28,000
March 16	Gabel Company	n/30	$ 1,480		$ 1,480
Total			$ 78,440	$ 60,000	$ 2,440	$ 16,000

Req 2c.

Cash Receipts Journal

Date	Account Credited	Cash Dr.	Sales Discount Dr.	Accounts receivable Cr.	Sales Cr.	Other Accounts Cr.	Cost of goods sold
March 6	Notes Payable	$ 72,000				$ 72,000
March 12	Min Cho	$ 12,116	$ 684	$ 12,800
March 13	Linda Witt	$ 3,648	$ 192	$ 3,840
March 15	Cash Sale	$ 51,200			$ 51,200		$ 40,960
March 20	Jobita Albany	$ 3,104	$ 96	$ 3,200
March 31	Cash Sale	$ 56,320			$ 56,320		$ 33,792
Total		$ 198,388	$ 972	$ 19,840	$ 107,520	$ 72,000	$ 74,752

Req 2d.

Cash Payments Journal

Date	Account Debited	Check No.	Cash Cr.	Purchase Discount Cr.	Accounts Payable Dr.	Other Accounts Dr.
March 13	Van Industries	416	$ 31,040	$ 960	$ 32,000
March 15	Payroll	417	$ 17,400			$ 17,400
March 23	CD Company	418	$ 24,444	$ 756	$ 25,200
March 31	Payroll	419	$ 17,400			$ 17,400
Total			$ 90,284	$ 1,716	$ 57,200	$ 34,800

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