XVIII
This set comprises a general journal; a sales journal, a sales returns and allowances journal, a purchase journal, a purchase returns and allowances journal, and the cash journals, for convenience bound together in one book; a note journal to be used as a posting medium for notes receivable and notes payable; and a general ledger, a purchase ledger, and a sales ledger, bound together in one book. Of the subsidiary journal blank, page 1 is for the sales journal, page 2 the sales returns, page 3 the purchase journal, page 4 the purchase returns, and pages 6-9 the cash journals. Of the ledger blank, pages 1-15 comprise the general ledger, pages 16-19 the sales ledger, and pages 20-22 the purchase ledger. The general journal will be used as previously, i.e., for the record of all items not otherwise specially provided for. The sales journal provides for analysis of the sales, the first column being the total or general column; the others, Dept. A, Dept. B, and Out-Freight, respectively. The sales returns and allowances journal makes provision for the same analysis as the sales journal except that there is no Out-Freight column, that not being used; the purchase journal columns are respectively, Total, Dept. A, Dept. B, and In-Freight, with the same column headings for the purchase returns and allowances journal, except as to In-Freight. The cash book columns will be, on the debit, General, Accounts Receivable, Sales Discount, and Harding National Bank; and on the credit, General, Accounts Payable, Purchase Discount, and Harding National Bank. The note journal will be analyzed, summarized, and posted just as the other subsidiary journals.
The deposit account carried with the Coolidge National Bank is an inactive one. For this reason no extra column is provided for it in the cash book.
Daily posting of items affecting customers’ and creditors’ accounts should be made, carefully observing the terms of credit.
The general journal is provided with six money columns, three of which are to be devoted to charges and the other three to credits. The debit columns are to be headed, Accounts Payable, Accounts Receivable, and General, respectively. The credit columns will be headed similarly but in the reverse order, having the General column close to the ledger folio column. All amounts to be posted to accounts in the general ledger should be recorded in the General column, and those affecting a controlling account in its respective column. The latter amounts should be posted to the subsidiary account immediately, but will not be posted to the controlling account until the general journal is summarized at the end of the month. Record will be made of transactions for the last month of the fiscal year, the previous eleven months being summarized in the trial balance given to start with.
The Business Equipment Corporation was organized and incorporated under the laws of the state of New York. Its fiscal year closes on December 31. A trial balance from the general ledger on November 30, 19—, shows as follows:
| 1 | Harding National Bank | $ 6,521.25 | ||
| 1 | Coolidge State Bank | 5,000.00 | ||
| 1 | Consignment Accounts Receivable | |||
| 1 | Petty Cash | 200.00 | ||
| 1 | Notes Receivable | 8,419.80 | ||
| 2 | Accounts Receivable | 146,838.05 | ||
| 2 | Reserve for Doubtful Accounts | $ 2,574.85 | ||
| 2 | Investments | 12,750.00 | ||
| 2 | Notes Receivable Special | |||
| 3 | Department A, Inventory | 78,769.40 | ||
| 3 | Department B, Inventory | 52,918.25 | ||
| 3 | Delivery Equipment | 13,000.00 | ||
| 3 | Depreciation Reserve Delivery Equipment | 8,000.00 | ||
| 4 | Store and Warehouse Furniture and Fixtures | 4,500.00 | ||
| 4 | Depreciation Reserve Store and Warehouse Furniture and Fixtures | 2,000.00 | ||
| 4 | Office Furniture and Fixtures | 1,250.00 | ||
| 4 | Depreciation Reserve Office Furniture and Fixtures | 500.00 | ||
| 5 | Buildings | 60,000.00 | ||
| 5 | Depreciation Reserve Buildings | 15,000.00 | ||
| 5 | Land | 10,800.00 | ||
| 5 | Mortgage on Real Estate | 35,000.00 | ||
| 6 | Notes Payable | 6,472.50 | ||
| 6 | Accounts Payable | 94,969.17 | ||
| 6 | Dividends Payable Common | |||
| 6 | Dividends Payable Preferred | |||
| 7 | Capital Stock Common | 100,000.00 | ||
| 7 | Capital Stock Preferred | 100,000.00 | ||
| 7 | Surplus | 34,792.80 | ||
| 8 | Profit and Loss | |||
| 9 | Department A, Purchases | 478,860.00 | ||
| 9 | Department A, Purchases Returns and Allowances | 15,678.90 | ||
| 9 | Department B, Purchases | 397,725.00 | ||
| 9 | Department B, Purchases Returns and Allowances | 12,796.40 | ||
| 10 | In-Freight and Cartage | 9,642.57 | ||
| 10 | Department A, Sales | 567,819.60 | ||
| 10 | Department A, Sales Returns and Allowances | 10,649.30 | ||
| 10 | Department B, Sales | 471,932.40 | ||
| 11 | Department B, Sales Returns and Allowances | 7,427.80 | ||
| 11 | Salesmen’s Salaries and Commissions | 29,942.70 | ||
| 11 | Salesmen’s Traveling Expenses | 17,897.60 | ||
| 11 | Advertising | 22,000.00 | ||
| 12 | Sales General Expense | 23,649.30 | ||
| 12 | Out-Freight | 472.73 | ||
| 12 | Insurance | 7,562.40 | ||
| 12 | Office Expense | 2,890.78 | ||
| 13 | Office Supplies | 3,697.40 | ||
| 13 | General Expense | 12,897.48 | ||
| 13 | General Salaries | 32,894.72 | ||
| 13 | Interest and Bank Expense | 2,344.52 | 586.13 | |
| 14 | Sales Discount | 15,849.50 | ||
| 14 | Bad Debts | |||
| 14 | Depreciation | |||
| 14 | Purchase Discount | 10,297.80 | ||
| 15 | Taxes | |||
| 15 | Mortgage Interest | 1,050.00 | ||
| 15 | Consignment | |||
| 15 | Consignment-Out | |||
| $1,478,420.55 | $1,478,420.55 |
Instructions
Open all the above accounts in your general ledger, at the places indicated, and enter under date of December 1 the balances given in the trial balance. The number in front of the account title indicates the page on which to enter the accounts. Give each one-fourth of a page, except on page 2, where give Accounts Receivable two additional lines by shortening the space for Investments.
In the sales ledger (which is controlled by the Accounts Receivable account on the general ledger), beginning on page 16, open the following accounts, four to a page, and enter the balances as of December 1: