Question

May1. Paid rent for May $ 5000

Date	Description	post ref	Debit	Credit
MAY 1.	RENT EXPENSE A/C Dr	531	5000
	To CASH A/C	110		5000

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

Date	Description	post ref	Debit	Credit
MAY 3.	INVENTORY A/C Dr	115	36000
	To ACCOUNTS PAYABLE A/C	210		36000

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

Date	Description	post ref	Debit	Credit
MAY 4.	INVENTORY A/C Dr	115	600
	TO CASH A/C	112		600

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

Date	Description	post ref	Debit	Credit
MAY 6.-SALES	ACCOUNTS RECEIVABLE A/C Dr	112	68500
	TO SALES A/C	410		68500
MAY 6.-COST	COST OF GOODS SOLD A/C Dr	510	41000
	TO INVENTORY A/C	115		41000

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

Date	Description	post ref	Debit	Credit
MAY 7	CASH A/C Dr	110	22300
	TO ACCOUNTS RECEIVABLE A/C	112		22300

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

Date	Description	post ref	Debit	Credit
MAY 10-SALE	CASH A/C Dr	110	54000
	TO SALES A/C	410		54000
MAY 10-COST	COST OF GOODS SOLD A/C Dr	510	32000
	TO INVENTORY A/C	115		32000

May 13: Paid for merchandise purchased on May 3.

Date	Description	post ref	Debit	Credit
MAY.13	ACCOUNTS PAYABLE A/C Dr	210	360
DISCOUNT OF1%	TO INVENTORY A/C	115		360
MAY 13-PAYMENT	ACCOUNTS PAYABLE A/C Dr	210	35640
	TO CASH A/C	110		35640

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

Date	Description	post ref	Debit	Credit
MAY 15	ADVERTISING EXPENSE A/C Dr	521	11000
	TO CASH A/C	110		11000

May 16: Received cash from sale of May 6.

Date	Description	post ref	Debit	Credit
MAY .16	CASH A/C Dr	110	67130
	SALES DISCOUNT A/C Dr		1370
	TO ACCOUNTS RECEIVABLE A/C	112		68500
	(2% SALE DISCOUNT)

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

Date	Description	post ref	Debit	Credit
MAY 19	INVENTORY A/C Dr	115	18700
	TO CASH A/C	110		18700

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

Date	Description	post ref	Debit	Credit
MAY 19	ACCOUNTS PAYABLE A/C Dr	210	33450
	TO CASH A/C	110		33450

May 20: Paid Korman Co. a cash refund of $13,230 for returned merchandise from sale of May 6. The invoice amount of the returned merchandise was $13,500 and the cost of the returned merchandise was $8,000

Date	Description	post ref	Debit	Credit
MAY 20-SALES	SALES RETURN A/C Dr		13230
	TO CASH A/C	110		13230
MAY 20-COST	INVENTORY A/C Dr	115	8000
	TO COST OF GOODS SOLD A/C	510		8000

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

Date	Description	post ref	Debit	Credit
MAY 20-SALE	ACCOUNTS RECEIVABLE A/C Dr	112	110000
	TO SALES A/C	410		110000
MAY 20-COST	COST OF GOOD SOLD A/C Dr	510	70000
	TO INVENTORY A/C	115		70000

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

Date	Description	post ref	Debit	Credit
MAY 21	ACCOUNTS RECEIVABLE A/C Dr	112	2300
	TO CASH A/C	110		2300

FOR FREIGHT PAID BY THE SELLER(THE AMOUNT WILL BE TAKEN FROM THE PURCHASER AND HENCE ACCOUNTS RECEIVABLE IS DEBITED

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

Date	Description	post ref	Debit	Credit
,MAY 21	CASH A/C Dr	110	42900
	TO ACCOUNTS RECEIVABLE A/C	112		42900

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

Date	Description	post ref	Debit	Credit
MAY 21	INVENTORY A/C Dr	115	88000
	TO ACCOUNTS PAYABLE A/C	210		88000

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

Date	Description	post ref	Debit	Credit
MAY 24	ACCOUNTS PAYABLE A/C Dr	210	5000
	TO INVENTORY A/C	115		5000

May 26: Refunded cash on sales made for cash, $7,500. The cost of the merchandise returned was $4,800.

Date	Description	post ref	Debit	Credit
MAY 26-REFUND	SALES RETURNS A/C Dr		7500
	TO CASH A/C	110		7500
MAY 26- COST	INVENTORY A/C Dr	115	4800
	TO COST OF GOODS SOLD A/C	510		4800

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

Date	Description	post ref	Debit	Credit
MAY 28	SALES SALARIES EXPENSE A/C Dr	520	56000
	OFFICE SALARIES EXPENSE A/C Dr	530	29000
	TO CASH A/C	110		85000

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

Date	Description	post ref	Debit	Credit
MAY 29	STORE SUPPLIES A/C	118	2400
	TO CASH A/C	110		2400

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

Date	Description	post ref	Debit	Credit
MAY 30-SALES	ACCOUNTS RECEIVABLE A/C Dr	112	78750
	TO SALES A/C	410		78750
MAY 30-COST	COST OF GOODS SOLD A/C Dr	510	47000
	TO INVENTORY A/C	115		47000

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

Date	Description	post ref	Debit	Credit
MAY 30	CASH A/C Dr	110	111200
	SALES DISCOUNT A/C Dr		1100
	TO ACCOUNTS RECEIVABLE A/C	112		112300

1% DISCOUNT ON 110000

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

Date	Description	post ref	Debit	Credit
MAY 31	ACCOUNTS PAYABLE A/C Dr	210	83000
	TO CASH A/C	110		83000

1. Prepare an unadjusted trial balance. If an amount box does not require an entry, leave it blank.

   Palisade Creek Co. Unadjusted Trial Balance May 31, 20Y6
   	Debit	Credit
   Cash
   Accounts Receivable
   Inventory
   Estimated Returns Inventory
   Prepaid Insurance
   Store Supplies
   Store Equipment
   Accumulated Depreciation-Store Equipment
   Accounts Payable
   Salaries Payable
   Customers Refunds Payable
   Common Stock
   Retained Earnings
   Dividends
   Sales
   Cost of Goods Sold
   Sales Salaries Expense
   Advertising Expense
   Depreciation Expense
   Store Supplies Expense
   Miscellaneous Selling Expense
   Office Salaries Expense
   Rent Expense
   Insurance Expense
   Miscellaneous Administrative Expense

Answer 1

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	Debit	Credit
Cash		$            290
Accounts Receivable	$      13,550
Inventory		$      39,260
Estimated Returns Inventory
Prepaid Insurance
Store Supplies	$        2,400
Store Equipment
Accumulated Depreciation-Store Equipment
Accounts Payable	$      33,450
Salaries Payable
Customers Refunds Payable
Common Stock
Retained Earnings
Dividends
Sales		$   311,250
Sales Discount	$        2,470
Sales Return	$      20,730
Cost of Goods Sold	$   177,200
Sales Salaries Expense	$      56,000
Advertising Expense	$      11,000
Depreciation Expense
Store Supplies Expense
Miscellaneous Selling Expense
Office Salaries Expense	$      29,000
Rent Expense	$        5,000
Insurance Expense
Miscellaneous Administrative Expense
Total	$   350,800	$   350,800