- Balance of cash on hand July 1, 19—, $8,940.
- July 2, received from cash sales over the counter $760.
- July 3, received from customers in payment of notes $575.
- July 5, paid for salaries $175, motor repairs $85,
- advertising $325, postage $22.
- July 6, discounted $1,000 6% 30-day note at the bank.
- July 7:
- Paid for new Ford truck $925, f.o.b. Detroit, and
- freight-in on truck, $38.75; insurance $75.
- Paid creditors $4,290.
- Made a promissory note in favor of a creditor for $500 for
- three months at 6%.
- Paid note for $2,000 due on the 8th of July with interest at
- 6% for three months.
- Bought a Liberty bond for $887.50 with accrued interest of $16.50.
(b) Set up the Cash account.
(c) Show the account properly ruled and balanced.
5. Name the debits and credits for each of the following transactions and set up the Notes Payable account:
- On October 1, 19—, discounted 30-day 6% note for $2,500 at the bank.
- Paid six months’ promissory note at 6% for $1,000 on the
- 10th and gave to a trade creditor our note for $3,750
- due in 30 days without interest for balance of open account.
- Discounted trade customer’s three months’ 6% note for
- $5,000 at bank on the 15th, the discount period being 60 days.
- Paid note for $2,500 at the bank on the 31st.
6. The Willow Spring Dairy Farm purchased a new Cleveland Tractor April 1 for $1,850, f.o.b. Cleveland. Freight charges were $32.90; insurance in transit $15; hauling the accessories from the station to the farm $12; attachments cost $435; and assembling the parts cost $35. After being used for six months the machine with accessories was sold for $2,000.
Set up the Farm Implements account and determine the profit or loss. Disregard depreciation.
7. On January 15 a tract of land was purchased for $32,000, which amount included the cost of searching title $800, and unpaid taxes at time of purchase $350. The cash paid included all but the taxes.
- On March 1 a new road was completed through the tract at a cost of $1,250.
- April 1 the unpaid taxes of $350 were paid.
- August 1 assessments were levied for the state highway amounting to $3,280.
- Half of the land was sold, December 10, for $18,500.
- Name the debits and credits of each of these transactions and set up the Land account.
Instructions