Crown Rug Company had the following credit sales transactions during August 2010:

The August 1 inventory was $44,500, consisting of:

During August, Crown Rug Company purchased the following rugs from Royal Importers:

The general ledger includes the following accounts:

Account? ? ? ? ??

Number ? ? ? ? ? ? ? ? ? ? ?Account? ? ? ? ??? ? ? ? ? ??

11 ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ?Accounts Receivable

12 ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ?Merchandise Inventory

21 ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ?Accounts Payable

41 ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ?Sales

51 ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ?Cost of Merchandise Sold

a. Record the sales in a two-column sales journal. Use the sales journal form shown in Appendix 1 at the end of this chapter. Begin with Invoice No. 93.

b. Record the purchases in a purchases journal. Use the purchases journal form shown in Appendix 1 at the end of this chapter.

c. Assume that you have posted the journal entries to the appropriate ledgers. Insert the correct posting references in the sales and purchases journals.

d. Determine the August 31 balance of Merchandise Inventory.

Transcribed Image Text:

Rug Style 10 by 8 Chinese 8 by 12 Persian 8 by 10 Indian 10 by 12 Persian Date Sales Customer Quantity Wes McGill Joan Felt Paula Larkin Rajiv Kumar Aug. 7 12 23 30 $15,500 11,500 23,000