Crestview Computer Security uses the perpetual inventory system and makes all credit sales on terms of 2/10 n /30. Crestview completed the following transactions during May.
May 2 Issued inv. # 913. For sale on account to Forbes, $2000.crestview cost of this inv. was $900
3 Puschased inv. on credit terms of 3/10 n/60 from Chicosky. co. $2467
5 Sold inventory for cash $1077 (cost $480)
5 Issued ck. # 532 to purchase furniture for cash, $2185
8 Collected interest revenue of $1775
9 Issued inv. #914 for sale on account to Bell $5550 ( cost 2310)
10 Purchased inv. for cash $1143 issuing ck # 533
12 Received cash from Forbes in full settlement of her acc. receivable from sale on May 2nd
13 Purchased supplies on acct. from Manley, $441. terms were net end of the month
15 Sold inv. on account to brown issuing invoice # 915 for $665 ( cost 240)
17 Issued credit memo, to Brown for $665 for merchandise return to us by brown . Also accounted
forreceipt of the inventory cost.
18 Issuedinvoice#916 for credit sale to Forbes $357 ( cost $127)
19 Received $5439from Bell in full settlement of its acct./recievable from May 9th.bell earned discount by paying early
20 Purchased inventory on credit terms of net 30 from Sims $2047
22 Purchased furniture on credit terms of 3/10 n/60 from Chicosky $645
22 Issued ck# 535to pay for insurance coverage debiting prepaid insurance fro$1000
24 Sold supplies to an employee fro cash of $54which was Crestview cost.
25 Issued ck#536 to pay utilities bills $453
28 Purchased inventory on credit terms 2/10 n/30 from Manley$675
29 Returned damagaed inventory to Manley issuing a debit memo for $675
29 Sold goods on account to Bell issuing invoice# 917 for $2900 (cost $ 800)
30 Issued ck# 537 to pay Manley in full on account from May 13th
31 Received cash in full from Forbes on credit sale of May 18th . There was no discount
31 Issued ck# 538 to pay monthly salaries of $1950
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1. Open the following four column general ledger accounts using the Crestview Computer Security account numbers: Cash 111, Accounts Receivable 112, Supplies 116, Prepaid Insurance 117, Inventory 118, Furniture 151, Accounts Payable 211, Sales Revenue 411, Sales Discounts 412, Sales Returns and Allowances 413, Interest Revenue 419, Cost of Goods Sold 511, Salary Expense 531, Utility Expense 541
2. Open these accounts using the subsidiary ledgers: Accounts receivable ledger–Bell Co., M.O. Brown, and K.D.Forbes.Accounts payable ledger–Chicosky Co, Manley, Inc.; and Sims Distributing.
3. Enter the transactions in a sales journal, a cash receipts journal, a purchases journal, a cash payments journal, and a general journal, as appropriate.
4. Post daily to the accounts receivable ledger and to the accounts payable ledger. On May 31, post to the general ledger.
5. Total each column of the special journals. Show that total debits equal total credits in each special journal.
6. Balance the total of the customer balances in the accounts receivable ledger against Accounts Receivable in the general ledger. Do the same for the accounts payable ledger and Accounts Payable in the general ledger.