Question

evenue and cash receipts journals; accounts receivable subsidiary and general ledgers

Transactions related to revenue and cash receipts completed by Crowne Business Services Co. during the period April 2–30 are as follows:

Apr. 2.		Issued Invoice No. 793 to Ohr Co., $7,580.
Apr. 5.		Received cash from Mendez Co. for the balance owed on its account.
Apr. 6.		Issued Invoice No. 794 to Pinecrest Co., $2,730.
Apr. 13.		Issued Invoice No. 795 to Shilo Co., $4,070.
		Post revenue and collections to the accounts receivable subsidiary ledger.
Apr. 15.		Received cash from Pinecrest Co. for the balance owed on April 1.
Apr. 16.		Issued Invoice No. 796 to Pinecrest Co., $8,500. Post revenue and collections to the accounts receivable subsidiary ledger.
Apr. 19.		Received cash from Ohr Co. for the balance due on invoice of April 2.
Apr. 20.		Received cash from Pinecrest Co. for balance due on invoice of April 6.
Apr. 22.		Issued Invoice No. 797 to Mendez Co., $11,190.
Apr. 25.		Received $3,090 note receivable in partial settlement of the balance due on the Shilo Co. account.
Apr. 30.		Received cash from fees earned, $19,090. Post revenue and collections to the accounts receivable subsidiary ledger.

Required:

1. Insert the following balances in the general ledger as of April 1:

11	Cash	$16,990
12	Accounts Receivable	20,690
14	Notes Receivable	9,000
41	Fees Earned	-

After completing the recording of the transactions in the journals in part 3, total each of the columns of the special journals, and post the individual entries and totals to the general ledger. Insert account balances after the last posting. When posting to the general ledger, post in chronological order. However, if there is more than one entry on the same date, be sure to post transactions from the revenue journal before posting transactions from the cash receipts journal.

If an amount box does not require an entry, leave it blank. In CNOW, Journal pages begin with “J”, Cash Receipts begin with “CR” and Cash Receipts begins with “R”. For example journal/ Cash Receipts/ Cash Receipts, page 1/36/40 respectively. POST. REF. is simply J1, CR36, and R40.

2. Insert the following balances in the accounts receivable subsidiary ledger as of April 1:

Mendez Co.	$11,890
Ohr Co.	-
Pinecrest Co.	8,800
Shilo Co.	-

After completing the recording of the transactions in the journals in part 3, post to the accounts receivable subsidiary ledger in chronological order, and insert the balances at the points indicated in the narrative of transactions. Determine the balance in the customer's account before recording a cash receipt. If an amount box does not require an entry, leave it blank. In CNOW, Journal pages begin with “J”, Cash Receipts begin with “CR” and Cash Receipts begins with “R”. For example journal/ Cash Receipts/ Cash Receipts, page 1/36/40 respectively. POST. REF. is simply J1, CR36, and R40.

3. Prepare a single-column revenue journal (p. 40) and a cash receipts journal (p. 36). Use the following column headings for the cash receipts journal: Fees Earned Cr., Accounts Receivable Cr., and Cash Dr. The Fees Earned column is used to record cash fees.

4. Using the two special journals and the two-column general journal (p. 1), journalize the transactions for April. Post to the accounts receivable subsidiary ledger, and insert the balances at the points indicated in the narrative of transactions. Determine the balance in the customer’s account before recording a cash receipt.

5. Total each of the columns of the special journals and post the individual entries and totals to the general ledger. Insert account balances after the last posting.

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

6. What is the sum of the customer balances?
$

Does the sum of the customer balances agree with the accounts receivable controlling account in the general ledger?
  

7. Would an automated system omit postings to a controlling account as performed in step 5 for Accounts Receivable?

Answer 1

DATE	INVOICE NO.	PARTICULARS	DEBIT($)	CREDIT($)
APRIL,2	793	OHR. CO.	7580
		TO REVENUE		7580
APRIL,5	794	CASH	11890
		TO MENDEZ CO.		11890
APRIL,6	795	PINCREST	2730
		TO REVENUE		2730
APRIL,13	796	SHILO CO.	4070
		TO REVENUE		4070
APRIL, 15		CASH RECIEPT	8800
		TO PINECREST		8800
APRIL, 16	797	PINECREST CO.	8500
		TO REVENUE		8500
APRIL,19		CASH	7580
		TO OHR. CO.		7580
APRIL,20		CASH	2730
		TO PINCREST CO.		2730
APRIL,22	798	MENDEZ CO.	11190
		TO REVENUE		11190
APRIL,25		NOTES RECIEVABLE	3090
		TO SHILO CO.		3090
APRIL,30		CASH	19090
		TO FEES EARNED		19090

ACCOUNTS RECIEVABLE SUBSIDIARY LEDGER

ACCOUNTS	BALANCE
MENDEZ CO.	11190
OHR CO.	-
PINECREST CO.	8500
SHILO CO.	980
TOTAL	20670

REVENUE JOURNAL

ACCOUNTS	AMOUNT ($)
OHR CO.	7580
PINCREST	11230 (2730+8500)
SHILO CO.	4070
MENDEZ CO.	11190

CASH RECIEPT JOURNAL

ACCOUNTS	AMOUNT ($)
FEES EARNED	19090
ACCOUNTS RECIEVABLE	31000
CASH DR.	-
TOTAL	50090

GENERAL LEDGER

ACCOUNTS	BALANCE($)
CASH (16990+50090)	67080
ACCOUNTS RECIEVABLE (20690+20670)	41360
NOTES RECIEVABLE (9000+3090)	12090
FEES EARNED	19090

ALL FIGURES ARE IN DOLLORS.