Kentucky Companys chart of accounts includes the following selected accounts. 101 Cash.........401 Sales 112 Accounts Receivable....414 Sales

Question:

Kentucky Company’s chart of accounts includes the following selected accounts.

101 Cash.........401 Sales

112 Accounts Receivable....414 Sales Discounts

120 Merchandise Inventory..505 Cost of Goods Sold

301 Ken Tucky, Capital

On June 1 the accounts receivable ledger of Kentucky Company showed the following balances:

Moose & Son $3,500, Chris Co. $2,800, Cornell Bros. $2,400, and Marx Co. $2,000.The June transactions involving the receipt of cash were as follows.

June 1 The owner, Ken Tucky, invested additional cash in the business $12,000.

3 Received check in full from Marx Co. less 2% cash discount.

6 Received check in full from Chris Co. less 2% cash discount.

7 Made cash sales of merchandise totaling $8,700.The cost of the merchandise sold was

$5,000.

9 Received check in full from Moose & Son less 2% cash discount.

11 Received cash refund from a supplier for damaged merchandise $450.

15 Made cash sales of merchandise totaling $6,500.The cost of the merchandise sold was $4,000.

20 Received check in full from Cornell Bros. $2,400.

Instructions

(a) Journalize the transactions above in a six-column cash receipts journal with columns for Cash Dr., Sales Discounts Dr., Accounts Receivable Cr., Sales Cr., Other Accounts Cr., and Cost of Goods Sold Dr./Merchandise Inventory Cr. Foot and crossfoot the journal.

(b) Insert the beginning balances in the Accounts Receivable control and subsidiary accounts, and post the June transactions to these accounts.

Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...