PC Depot was a retail store for personal computers and hand-held calculators, selling several national brands in
Question:
Thompson knew the importance of adequate records. One of her first decisions, therefore, was to hire Chris Jarrard, a local accountant, to set up her bookkeeping system.
Jarrard wrote up the store's preopening financial transactions in journal form to serve as an example (Exhibit 1). Thompson agreed to write up the remainder of the store's September financial transactions for Jarrard's later review.
At the end of September, Thompson had the following items to record:
Questions
1. Explain the events that probably gave rise to journal entries 1 through 8 of Exhibit 1.
2. Set up a ledger account (in T account form) for each account named in the general journal. Post entries 1 through 8 to these accounts, using the entry number as a cross-reference.
3. Analyze the facts listed as 9 through 20, resolving them into their debit and credit elements. Prepare journal entries and post to the ledger accounts. (Do not prepare closing entries.)
4. Consider any other transactions that should be recorded. Why are these adjusting entries required? Prepare journal entries for them and post to ledger accounts.
5. Prepare closing entries and post to ledger accounts. What new ledger accounts are required? Why?
6. Prepare an income statement for September and a balance sheet as of September 30.
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
Step by Step Answer:
Accounting Texts and Cases
ISBN: 978-1259097126
13th edition
Authors: Robert Anthony, David Hawkins, Kenneth Merchant