Question

Church Company completes these transactions and events during March of the current year (terms for all its credit sales are 2/10, n/30).

Mar.		1				Purchased $36,000 of merchandise from Van Industries, invoice dated March 1, terms 2/15, n/30.
		2				Sold merchandise on credit to Min Cho, Invoice No. 854, for $14,400 (cost is $7,200).
		3		(a)		Purchased $1,080 of office supplies on credit from Gabel Company, invoice dated March 3, terms n/10 EOM.
		3		(b)		Sold merchandise on credit to Linda Witt, Invoice No. 855, for $7,200 (cost is $3,600).
		6				Borrowed $72,000 cash from Federal Bank by signing a long-term note payable.
		9				Purchased $18,000 of office equipment on credit from Spell Supply, invoice dated March 9, terms n/10 EOM.
		10				Sold merchandise on credit to Jovita Albany, Invoice No. 856, for $3,600 (cost is $1,800).
		12				Received payment from Min Cho for the March 2 sale less the discount.
		13		(a)		Sent Van Industries Check No. 416 in payment of the March 1 invoice less the discount.
		13		(b)		Received payment from Linda Witt for the March 3 sale less the discount.
		14				Purchased $32,000 of merchandise from the CD Company, invoice dated March 13, terms 2/10, n/30.
		15		(a)		Issued Check No. 417, payable to Payroll, in payment of sales salaries expense for the first half of the month, $16,000. Cashed the check and paid the employees.
		15		(b)		Cash sales for the first half of the month are $57,600 (cost is $46,080). (Cash sales are recorded daily, but are recorded only twice here to reduce repetitive entries.)
		16				Purchased $1,600 of store supplies on credit from Gabel Company, invoice dated March 16, terms n/10 EOM.
		17				Received a $3,200 credit memorandum from CD Company for the return of unsatisfactory merchandise purchased on March 14.
		19				Received a $540 credit memorandum from Spell Supply for office equipment received on March 9 and returned for credit.
		20				Received payment from Jovita Albany for the sale of March 10 less the discount.
		23				Issued Check No. 418 to CD Company in payment of the invoice of March 13 less the March 17 return and the discount.
		27				Sold merchandise on credit to Jovita Albany, Invoice No. 857, for $10,800 (cost is $4,320).
		28				Sold merchandise on credit to Linda Witt, Invoice No. 858, for $4,320 (cost is $1,728).
		31		(a)		Issued Check No. 419, payable to Payroll, in payment of sales salaries expense for the last half of the month, $16,000. Cashed the check and paid the employees.
		31		(b)		Cash sales for the last half of the month are $63,360 (cost is $38,016).
		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 $65,000), Z. Church, Capital (March 1 beg. bal. is $65,000) and Church Company uses the perpetual inventory system.

NERAL LEDGER

Cash

Accounts Receivable

Date

Debit

Credit

Balance

Date

Debit

Credit

Balance

Mar. 31 (a)

Mar. 31 (a)

Mar. 31 (b)

Inventory

Office Supplies

Date

Debit

Credit

Balance

Date

Debit

Credit

Balance

Mar. 01

Mar. 17

Mar. 31 (a)

Store Supplies

Office Equipment

Date

Debit

Credit

Balance

Date

Debit

Credit

Balance

Accounts Payable

Long-Term Notes Payable

Date

Debit

Credit

Balance

Date

Debit

Credit

Balance

Z. Church, Capital

Sales

Date

Debit

Credit

Balance

Date

Debit

Credit

Balance

Mar. 01

Sales Discounts

Cost of Goods Sold

Date

Debit

Credit

Balance

Date

Debit

Credit

Balance

ACCOUNTS RECEIVABLE LEDGER

Sales Salaries Expense

Jovita Albany

Date

Debit

Credit

Balance

Date

Debit

Credit

Balance

Min Cho

Linda Witt

Date

Debit

Credit

Balance

Date

Debit

Credit

Balance

ACCOUNTS PAYABLE LEDGER

CD Company

Gabel Company

Date

Debit

Credit

Balance

Date

Debit

Credit

Balance

Spell Supply

Van Industries

Date

Debit

Credit

Balance

Date

Debit

Credit

Balance

Prepare the March 31 trial balance.

	CHURCH COMPANY Trial Balance March 31 Debit Credit Totals $0 $0

Prepare the March 31 schedule of accounts receivable.

	CHURCH COMPANY Schedule of Accounts Receivable March 31 Jovita Albany Linda Witt Min Cho Total accounts receivable

Prepare the March 31 schedule of accounts payable.

	CHURCH COMPANY Schedule of Accounts Payable March 31 Gabel Company Spell Supply Van Industries CD Company Total accounts payable $0

Answer 1

Accounts payable
Date	Debit	Credit	Balance
Mar.31	68540	88680	20140
			20140
Accounts Payable
Schedule
Spell Company		17460
Van Industries		0
CD Company		0
Gabel Company		2680

Van Industries
Date	Debit	Credit	Balance
Mar.1		36000	36000
Mar.13	36000		0
			0
			0
CD Company
Date	Debit	Credit	Balance
Mar.14	0	32000	32000
Mar.17	3200		28800
Mar.23	28800		0
			0
Gabel Company
Date	Debit	Credit	Balance
Mar.3		1080	1080
Mar.16		1600	2680
			2680
			2680

Accounts Receivable
Date	Debit	Credit	Balance
Mar.31	40320	25200	15120
			15120
Accounts Receivable
Schedule
Jovita Albany		10800
Linda Witt		4320
Minh Cho		0
Total		15120

Jovita Albany
Date	Debit	Credit	Balance
Mar.10	3600		3600
Mar.20		3600	0
Mar.27	10800		10800
Linda Wit
Date	Debit	Credit	Balance
Mar.3	7200		7200
Mar.13		7200	0
Mar.28	4320		4320
			4320
Min Cho
Date	Debit	Credit	Balance
Mar.2	14400		14400
Mar.12		14400	0
			0

SALES JOURNAL
Date	Account	Invoice	Accounts	Cost of goods
	Debited	Number	Receivable Dr	Sold Dr
			Sales Cr	Inventory Cr
Mar.2	Min.Cho	854	14400	7200
Mar.3	Linda Witt	855	7200	3600
Mar.10	Jovita Albany	856	3600	1800
Mar.27	Jovita Albany	857	10800	4320
Mar.28	Linda Witt	858	4320	1728
			40320	18648

PURCHASE JOURNAL
Date	Account	Date of	Terms	Accounts	Inventory	Office	Other
		Invoice		Payable Cr	Dr	Supplies Dr	Accounts Dr
Mar.1	Van Inddustries	Mar.1	2/15, n/30	36000	36000
Mar.3	Gabel Company	Mar.3	n/10 EOM	1080		1080
Mar.9	Spell Supply	Mar.9	n/10 EOM	18000			18000
Mar.14	CD Company	Mar.13	2/10, n/30	32000	32000
Mar.16	Gabel Company	Mar.16	n/10 EOM	1600			1600
				88680	68000	1080	19600
Cash Receipts Journal
Date	Account	Cash Dr	Cash	Accounts	Sales Cr	Other	Cost of goods
	Credited		Discount Dr	Receivable Cr		Account Cr	sold Dr
							Inventory Cr
Mar.6	Long term note payable	72000				72000
Mar.12	Min Cho	14112	288	14400
Mr.13	Linda Wit	7056	144	7200
Mar.15	Sales	57600			57600		46080
Mar.20	Jovita Albany	3528	72	3600
Mar.31	Sales	63360			63360		38016
		217656	504	25200	120960	72000	84096
Cash Disbursement Journal Journal
Date	Ck No.	Payee	Account	Cash Cr	Inventory	Other	Accounts
			Debited		Cr	Accounts Dr	Payable
							Dr
Mar.13	416	Van Inds.	Van .Inds.	35280	720		36000
Mar.15	417	Self	Salaries and	16000		16000
			wages payable
Mar.23	418	CD company	CD company	28224	576		28800
Mar.31	419	Self	Salaries and	16000		16000
			wages payable
				95504	1296	32000	64800

General Journal
Date	Account	Debit	Credit
Mar.6	Cash	72000
	Long term note payable		72000
	(Borrowed on note payable)
Mar.17	Accounts Payable - CD Company	3200
	Inventory		3200
	(Credit note received for defective material)
Mar.19	Accounts Payable - Spell company	540
	Office Equipment		540
	(Credit note received for defective material)

Cash					Inventory
Date	Debit	Credit	Balance		Date	Debit	Credit	Balance
Mar.6	72000		72000		Beg.Bal.	62000		62000
Mar.12	14112		86112		Mar.1	36000		98000
Mar.13		35280	50832		Mar.2		7200	90800
Mar.13	7056		57888		Mar.3		3600	87200
Mar.15		16000	41888		Mar.10		1800	85400
Mar.15	57600		99488		Mar.13		720	84680
mar.20	3528		103016		Mar.14	32000		116680
Mar.23		28224	74792		Mar.15		46080	70600
Mar.31		16000	58792		Mar.17		3200	67400
Mar.31	63360		122152		Mar.23		576	66824
					Mar.27		4320	62504
					Mar.28		1728	60776
Office supplies					Mar.31		38016	22760
Date	Debit	Credit	Balance
Mar.3	1080		1080
			1080		Stores supplies
			1080		Date	Debit	Credit	Balance
					Mar.16	1600		1600
								1600