MGAB01H3 Lecture Notes - Lecture 10: Accounts Receivable

155 views2 pages

Verified Note

emeraldtermite610

7 Nov 2018

School

Department

Course

Professor

For unlimited access to Class Notes, a Class+ subscription is required.

MGAB01H3 verified notes

10/13View all

MGAB01H3 Lecture 8: MGAB01 Week8 review of chapter4 and part of chapter 6

MGAB01H3 Lecture Notes - Lecture 10: Accounts Receivable

MGAB01H3 Lecture Notes - Lecture 11: Internal Control, Bank Reconciliation, Bank Statement

Document Summary

The midterm distribution: top 25% - 79 above. Cash/sales discount: discount give to pay whole cash. Reason: make people actually pay money on time, then the firm don"t need to follow. Credit card discounts: credit card company guarantee to pay. So the firm don"t need to worry about receivable. All of those discount"s purpose: actually, get to pay. Now, the cash discount is 2% when you pay early cash. Why we list sales return instead of just put back to origin account: via doing this we can follow the item"s situation and know how sales people do. Bad debt: account receivable over time and has few possibility to get paid. We should estimate bad debt before and decide allowance for bad debt. There are two ways to estimate bad debt: percentage of credit sales: based on historical number to estimate the percentage of estimate uncollectible.

Related Questions

1. Total each column of the special journals. Show that thetotal debits equal the total credits in each special journal.

2. Balance or reconcile the amounts receivable subsidiary ledgerand accounts receivable in the general ledger. Do the same for theaccounts payabel subsidiary ledger and accounts payable in thegeneral ledger.

SalesJournal PAGE 7
DATE		INVOICE NO.	ACCOUNTS DEBITED	POST. REF.	ACCOUNTS RECEIVABLE DR. SALES REVENUE CR.	COST OF GOODS SOLD DR. INVENTORY CR.
July	2	913	Ishikawa Corp		24600	10800
July	9	914	Bell Ltd		33300	13860
July	15	915	M.O.Brown		3990	1440
July	18	916	Ishikawa Corp		2142	762
July	29	917	Bell Ltd		2976	1320

Cash ReceiptsJournal PAGE 5
		DEBITS		CREDITS					COST OF GOODS SOLD DR. INVENTORY CR.
						OTHER ACCOUNTS
DATE		CASH	SALES DISCOUNTS	ACCOUNTS RECEIVABLE	SALES REVENUE	ACCOUNT TITLE	POST. REF.	AMOUNT
July	5	6462			6462	Cash sales			2880
July	8	6650				Interest revenue		6650
July	9	32967	333	33300		Bell Ltd
July	12	24354	246	24600		Ishikawa Corp
July	31	2142		2142		Ishikawa Corp

Req.

PurchasesJournal PAGE 10

CREDITS

DEBITS

OTHER ACCOUNTS

DATE

ACCOUNT CREDITED

INVOICE DATE

TERMS

POST REF.

ACCOUNTS PAYABLE

INVENTORY

SUPPLIES

ACCOUNT TITLE

POST. REF.

AMOUNT

July

Nakkach

14802

July

Burgess

12282

July

Manley

8050

Cash PaymentsJournal PAGE 8
					DEBITS		CREDITS
DATE		CHQ. NO.	ACCOUNTS DEBITED	POST REF.	OTHER ACCOUNTS	ACCOUNTS PAYABLE	INVENTORY	CASH
July	5		Furniture					13110
July	10		Purchases					6858
July	13		Nakkach			14802		14358
July	22		Prepaid insurance					6000
July	25		Utilities					6718
July	30		Manley Inc			8050		7889
July	31		Salaries					14082

Accounts Receivable SubsidiaryLedger

ACCOUNT BELLLTD.
DATE		ITEM	JRNL. REF.	DEBIT	CREDIT	BALANCE
July	9	Bell Ltd	6	33300		33300
July	19	Bell Ltd	13	32967		32967
July	19	Bell Ltd Discount	13		333	333
July	29	Bell Ltd	21	2976		2976

ACCOUNT M.O.BROWN
DATE		ITEM	JRNL. REF.	DEBIT	CREDIT	BALANCE
July	15	M.O.Brown (credit sale)	11	3990		3990
July	15	M.O.Brown (Sold to)	11		1440	1440

ACCOUNT ISHIKAWAINC.
DATE		ITEM	JRNL. REF.	DEBIT	CREDIT	BALANCE
July	2	Ishikawa Inc (credit sale)	1	24600		24600
July	10	Ishikawa Inc (discount)	8	246		246
July	10	Ishikawa Inc	8		24354	-24354
July	18	Ishikawa Inc (credit sale)	13		2142	-2142

Accounts Payable SubsidiaryLedger

ACCOUNT BURGESSDISTRIBUTINGLTD.
DATE		ITEM	JRNL. REF.	DEBIT	CREDIT	BALANCE
July	15	Burgess Distribution Ltd (Purchases)	15		$12,282	-$12,282

ACCOUNT NAKKACHCORP.
DATE		ITEM	JRNL. REF.	DEBIT	CREDIT	BALANCE
July	3	Nakkach Corp (purchase of inventory)	2		$14,802	-$14,802
July	13	Nakkach Corp (Discount)	9	$444.06		$444.06
July	22	Nakkach Corp (Furniture Purchase)	16		$3870	-$3870

ACCOUNT MANLEY,INC.
DATE		ITEM	JRNL. REF.	DEBIT	CREDIT	BALANCE
July	13	Manley Inc (Purchase of supplies)	10		$8646	-$8646
July	28	Manley Inc	19		$805	-$805
July	29	Manley Inc (Return)	20	$4050		$4050

pucecockroach350

Please Can you dojournal entries for each event. 2. Prepareadjusting entries, and Closing entries

The 2014 balance sheet of the Captain Jet Inc. is attached.During 2015, the following events occurred.
1. On January 10, sell merchandise on account to Rayms $9,800 andFischer $8,600. Terms 1/10, n/30. Freight $100 for each sale,F.O.B. shipping point.
2. On January 12, purchase merchandise on account from Zapfel$3,000 and Liotta $2,400. Terms 2/10, n/30. Freight $120 for eachsale, F.O.B. destination.
3. On January 13, receive checks, $4,000 from Longhini and $2,000from Hall, for sales on account after discount period haslapsed.
4. On January 15, send checks to Joosten for 9,000 less 2% cashdiscount, and to Maida for $11,000 less 1% cash discount.
5. On January 16, issue credit of $100 to Fieber for merchandisereturned.
6. On January 18, summary daily cash sales total $17,520.
7. On January 21, pay off the balances to Zapfel and Liotta for thepurchases on January 12.
8. On Feburary 9, receive payment in full from Rayms andFischer.
9. On March 1, pay rent of $6,000 for a two-year term.
10. On April 1, sell merchandise on account to Dunlap $1,600, term2/10, n/30. Freight $100, F.O.B. shipping point.
11. Pay $500 cash for office supplies on May 1.
12. Cash dividends totaling $900 are declared on June 13 and paidto stockholders on June 23.
13. Issue a note of $120,000 to bank (one year, annual interestrate 2%) for cash on July 1.
14. On July 5, purchase merchandise from Maida $33,000, terms 2/10,n/30.
15. On July 7, issue common stock 1000 shares, $10 par, in exchangeof a land with a fair market value of $15,000.
16. On July 8, return $200 of merchandise to Maida and receivecredit.
17. On August 1, sell merchandise to Lachey on account $80,000,term 1/10, n/30. Freight $1,500, F.O.B. shipping point.
18. On August 4, pay off the balance to Maida.
19. On August 10, receive half of the payment from Lachey.
20. On August 14, write off $1,300 bad debt for one account,Tooket.
21. On August 21, pay utilities expense, $10,092.
22. On August 31, Lachey pays off its balance.
23. On September 1, pay cash $7,500 to Farmington for merchandisepurchased last year.
24. On October 1, pay off notes payable $110,000 and associatedaccrued interest $6,000, of which $1,500 was shown on the balancesheet.
25. Over the year, sales and office employees earned $45,500 insalaries and wages, of which $1,500 was still payable at the end ofyear.
26. An unpaid utilities bill (December, $1,250) is due on January10 next year.

Additional Information at the end of the year:

1. Depreciation expense for the year was $13,250.
2. The company estimated that it has to pay federal income tax,$3,250.
3. After physically counting, the company decided that the endinginventories worth $40,146.
4. Based on its historical data, the company estimated that the baddebts were about 1% of net credit

sales.
5. Unearned revenue is decreased by $12,000.

6. The company expenses all of the supplies purchased during theyear.
7. No insurance policy is effective during the year.
8. The company used the gross method to record its purchases andsales on credit. 9. The company adopts the periodic inventorysystem.

Instructions:

Prepare journal entries for each event. 2. Prepare adjustingentries. Closing entries

CAPTAIN JET INC. BALANCE SHEETDECEMBER 31, 2014

Current Assets

Cash 42,500
Notes Receivable 16,000
Accounts Receivable 41,800
Less: Allowance for Doubtful Accounts I (3,000)

Nventories 38,000
Prepaid Insurance 540
Prepaid Rent 600

Total Current Assets 136,440

Non-Current Assets

Long-term Investments
Investments in held-for-maturity securities 52,000

Land held for future development 45,500

Property, Plant, and Equipment

Land 85,000

Buildings 675,000

Less: Accumulated Depreciation (187,500)

Intangible Assets

Capitalized Development Costs 8,000

Goodwill 76,700
Other Identifiable Intangible Assets 48,000

Total Non-Current Assets 802,700

Total Assets 939,140

Current Liabilities

Notes Payable 110,000

Accounts Payable 33,500

Unearned Revenues 12,000

Income Taxes Payable 8,440

Property Taxes Payable 6,600

Interest Payable 1,500

Total Current Liabilities 172,040

Non-Current Liabilities

Provisions Related to Pensions 84,100

Bonds Payable 300,000

Total Non-Current Liabilities 384,100

Total Liabilities 556,140

Stockholders' Equity

Common Stock 100,000
Preferred Stock 100,000
Paid-in-capital - Common Stock 27,500

Paid-in-capital - Preferred Stock 10,000
Retained Earnings 153,250
Accumulated Other Comprehensive Income 5,000

Less: Treasury Stock (12,750)

Total Stockholders' Equity 383,000

Total Liabilities and Stockholders' Equity393,140

Use the following check figures

Adjusted Trial Balance: Total $1,276,055

Income Statement:
Earning after income tax: $9,827

Retained Earnings Statement:

Retained Earnings: $162,177

Balance Sheet:

Inventory: $40,146

Total assets: $939,267

Statement of Cash Flows
Net cash flows from this year: ($1,274)

Cash (ending): $41,226

plumsheep398

I need help with the Post References of the Sales and Cash Journal as well as posting them to the General ledger accounts in the End of Month Posting:

Now that you have finished recording all of the transactions for the month of June, you are ready to perform the end of month posting procedure. The purpose of this end of month posting is to transfer the totals from the special journals to the appropriate general ledger accounts so that the balances in those ledger accounts reflect all of the transactions that occurred throughout the period.

Instructions for end of month posting

1)Total the columns in the special journals. Record the amount in the Total row of each journal.

2)Post the totals of the columns in the special journals to their corresponding ledger account. To confirm that the posting has been performed, a posting reference is recorded in the last row of the special journals. If the total of a column is not required to be posted, you need to record an X in the post reference field for that column.

3)Record the final unadjusted balance of each ledger account in the Unadjusted Balance row of each ledger, even for ledgers with a balance of zero. Although each ledger already has a running balance, the Unadjusted Balance row must still be filled out in order to receive full points.

SALES JOURNAL

Date		Account	Invoice No.	Post Ref.	Accounts Receivable	Sales Tax	Sales Revenue	Cost of Goods Sold
Jun	6	ARC - Great Sports	362	110-3	5,712	272	5,440	2,880
Jun	12	ARC - The Locker Room	363	110-6	21,147	1,007	20,140	9,820
Jun	17	ARC - Mick's Sporting	364	110-5	20,202	962	19,240	10,560
Jun	28	ARC - The Locker Room	365	110-6	1,197	57	1,140	600

Total					?	?	?	?
Post Reference					(?)	(?)	(?)	(?) / (?)

CASH PAYMENTS JOURNAL

Date		Account	Check No.	Post Ref.	Debit				Credit
Date		Account	Check No.	Post Ref.	Accounts Payable	Merchandise Inventory	Wages Expense	Other Accounts	Cash
Jun	3	Merchandise Inventory	731	X		3,520			3,520
Jun	4	APC - Sport Borders	732	210-4	9,500				9,500
Jun	5	Wages Payable	733	220			835	1,000	1,835
Jun	6	APC - Addax Sports	734	210-2	5,400				5,400
Jun	9	APC - Sports 'R Us	735	210-5	8,700				8,700
Jun	12	Electricity Payable	736	221				1,420	1,420
Jun	12	Wages Expense	737	X			2,384		2,384
Jun	15	Prepaid Rent	738	140				2,000	2,000
Jun	19	Wages Expense	739	X			1,695		1,695
Jun	22	APC - Extreme Sports	740	210-3	49,313				49,313
Jun	24	APC - J. J. Spud	741	210-1	10,215				10,215
Jun	26	Wages Expense	742	X			2,320		2,320
Jun	30	Merchandise Inventory	743	X		3,200			3,200
Jun	30	Salary Expense	744	545				5,300	5,300

Total					?	?	?	?	?
Post Reference					(?)	(?)	(?)	(?)	(?)

GENERAL LEDGER

Account: Cash
Account No. 100

Date		Description	Ref.	Debit	Credit	Balance
May	31	Balance				65,589 DR
Jun	30
Jun	30
Jun	30
Jun	30	Unadjusted Balance

Account: ARC - Accounts Receivable Control
Account No. 110

Date		Description	Ref.	Debit	Credit	Balance
May	31	Balance				66,657 DR
Jun	30
Jun	30
Jun	30
Jun	30
Jun	30	Unadjusted Balance

Account: Merchandise Inventory
Account No. 120

Date		Description	Ref.	Debit	Credit	Balance
May	31	Balance				66,640 DR
Jun	21	Purchase return to Extreme Sports Inc	GJ		320	66,320 DR
Jun	30
Jun	30
Jun	30
Jun	30
Jun	30	Unadjusted Balance

Account: APC - Accounts Payable Control
Account No. 210

Date		Description	Ref.	Debit	Credit	Balance
May	31	Balance				78,148 CR
Jun	21	Purchase return to Extreme Sports Inc	GJ	320		77,828 CR
Jun	30
Jun	30
Jun	30					DRCR
Jun	30
Jun	30	Unadjusted Balance

Account: Sales Tax Payable
Account No. 240

Date		Description	Ref.	Debit	Credit	Balance
May	31	Balance				14,073 CR
Jun	30
Jun	30
Jun	30
Jun	30
Jun	30	Unadjusted Balance

Account: Sales Revenue
Account No. 400

Date		Description	Ref.	Debit	Credit	Balance
May	31	Balance				0
Jun	30
Jun	30
Jun	30
Jun	30	Unadjusted Balance

Account: Cost of Goods Sold
Account No. 500

Date		Description	Ref.	Debit	Credit	Balance
May	31	Balance				0
Jun	30
Jun	30
Jun	30
Jun	30	Unadjusted Balance

Account: Wages Expense
Account No. 516

Date		Description	Ref.	Debit	Credit	Balance
May	31	Balance				0
Jun	30
Jun	30
Jun	30
Jun	30	Unadjusted Balance

yellowmosquito946

MGAB01H3 Lecture Notes - Lecture 10: Accounts Receivable

MGAB01H3 Lecture 8: MGAB01 Week8 review of chapter4 and part of chapter 6

MGAB01H3 Lecture Notes - Lecture 10: Accounts Receivable

MGAB01H3 Lecture Notes - Lecture 11: Internal Control, Bank Reconciliation, Bank Statement

Document Summary

Get access

Related Documents

MGAB01H3 Chapter Notes - Chapter 6: Financial Statement, Bank Reconciliation, Field Of View

MGAB01H3 Chapter Notes - Chapter 7: Cash Management, Bank Reconciliation, Financial Statement

MGAB01H3 Lecture Notes - Lecture 16: Canadian Securities Administrators, Chief Financial Officer, Internal Control

Related Questions