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Principles of Accounting, Volume 1: Financial Accounting

Problem Set A

Principles of Accounting, Volume 1: Financial AccountingProblem Set A
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PA 1.

LO 7.2On June 30, Oscar Inc.’s bookkeeper is preparing to close the books for the month. The accounts receivable control total shows a balance of $2,820.76, but the accounts receivable subsidiary ledger shows total account balances of $2,220.76. The accounts receivable subsidiary ledger is shown here. Can you help find the mistake?

PA 2.

LO 7.4Evie Inc. has the following transactions during its first month of business. Journalize the transactions that go in the sales journal.

Jun. 1 Credit sale (invoice #1) to Green Lantern Inc. (acc #101) for $1,999
Jun. 2 Credit sale (invoice #2) to Wonder Woman Inc. (acc #102) for $2,000
Jun. 3 Credit sale to Flash Inc. (invoice #3) (acc #103) for $3,050
Jun. 4 Received $1,000 on account from Green Lantern Inc.
Jun. 5 Credit sale (invoice #4) to Black Panther Inc. (acc #104) for $1,875
Jun. 6 Received the full amount from Flash Inc.
PA 3.

LO 7.4The following transactions occurred for Donaldson Inc. during the month of July.

Jul. 1 Sold 50 items to Palm Springs Inc. and offered terms of 2/10, n/30, $4,000 on July 1, and issued invoice #12 on account number #312
Jul. 5 Sold 20 thing-a-jigs to Miami Inc. for $2,150 cash on July 5, and issued invoice #13
Jul. 8 Sold 30 what-is to Smith Mfg. for $5,000 and offered terms of 2/10, n/30; issued invoice #14 on account number #178
Jul. 9 Received payment from Palm Springs Inc.
Jul. 22 Received payment from Smith Mfg. after expiration of the discount period
  1. Record the transactions for Donaldson Inc. in the proper special journal and subsidiary ledger.
  2. Record the same transactions using QuickBooks, and print the journals and subsidiary ledger. They should match.
PA 4.

LO 7.4Use the journals and ledgers that follow. Total the journals. Post the transactions to the subsidiary ledger and (using T-accounts) to the general ledger accounts. Then prepare a schedule of accounts receivable.

PA 5.

LO 7.4Brown Inc. records purchases in a purchases journal and purchase returns in the general journal. Record the following transactions using a purchases journal, a general journal, and an accounts payable subsidiary ledger. The company uses the periodic method of accounting for inventory.

Oct. 1 Purchased inventory on account from Price Inc. for $2,000
Oct. 1 Purchased inventory on account from Cabrera Inc. for $3,000
Oct. 8 Returned half of the inventory to Price Inc.
Oct. 9 Purchased inventory on account from Price Inc. for $4,200
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