Question

Revenue and Cash Receipts Journals

Lasting Summer Inc. has $2,360 in the October 1 balance of the accounts receivable account consisting of $1,090 from Champion Co. and $1,270 from Wayfarer Co. Transactions related to revenue and cash receipts completed by Lasting Summer Inc. during the month of October 20Y5 are as follows:

Oct. 3.		Issued Invoice No. 622 for services provided to Palace Corp., $2,480.
5.		Received cash from Champion Co., on account, for $1,090.
8.		Issued Invoice No. 623 for services provided to Sunny Style Inc., $4,270.
12.		Received cash from Wayfarer Co., on account, for $1,270.
18.		Issued Invoice No. 624 for services provided to Amex Services Inc., $3,000.
23.		Received cash from Palace Corp. for Invoice No. 622 of October 3.
28.		Issued Invoice No. 625 to Wayfarer Co., on account, for $2,530.
30.		Received cash from Rogers Co. for services provided, $90.

a. Prepare a single-column revenue journal to record these transactions. Enter transactions in chronological order.

REVENUE JOURNAL				PAGE 19
DATE	Invoice No.	Account Debited	Post. Ref.	Accounts Rec. Dr. Fees Earned Cr.
20Y5
			✔
			✔
			✔
			✔
		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.
20Y5
		✔
		✔
		✔
Oct. 31	Total

b. Prepare a listing of the accounts receivable customer balances and verify that the total of the accounts receivable customer balances equals the balance of the accounts receivable controlling account on October 31, 20Y5.

Lasting Summer Inc.
Accounts Receivable Customer Balances
October 31, 20Y5
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:

Answer 1

Answer
Sales journal
Date	Accounts debited	Terms	Invoice no.	Dr. A/R Cr. Fees earned
03-Oct	Palace corp.		622	$                             2,480
08-Oct	Sunny style Inc.		623	$                             4,270
18-Oct	Amex service Inc		624	$                             3,000
28-Oct	Wayfarer Co.		625	$                             2,530
	Cash receipt Journal
Date	Account credited	Fees earned Cr.	Accounts rceeivable Cr.	Cash Dr.
05-Oct	Champion Co.		$                              1,090	$                             1,090
12-Oct	Wayfarer Co.		$                              1,270	$                             1,270
23-Oct	Palace Corp.		$                              2,480	$                             2,480
30-Oct	Rogers Co.	$                     90		$                                  90
b	Accounts receivable customer balance
	Amex Service inc	$                3,000
	Sunny style Inc.	$                4,270
	Wayfarer Co.	$                2,530
	Total accounts receivable	$                9,800