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An Accounting Cycle for a Corporation: Journalizing and Posting Transactions

Recording Transactions

The December $1$ account balances for the general and subsidiary ledgers are given in the Working Papers.

INSTRUCTIONS

Journalize the following transactions completed during December of the current year. GUS offers sales terms of $\frac{2}{10},\frac{n}{30}.$ The sales tax rate is $6\%.$ Post the following transactions when journalized: $(1)$ transactions impacting the accounts receivable or accounts payable subsidiary ledgers, $(2)$ transactions recorded in the general journal, and $(3)$ cash payments entered in a general amount column of the cash payments journal. Source documents are abbreviated as follows: check, $C_{\text{;}\text{m}\text{e}\text{m}\text{o}\text{r}\text{a}\text{n}\text{d}\text{u}\text{m}\text{,}}{M}_i$ purchase invoice, $P$; receipt, $R$; sales invoice, $S$; terminal summary, TS; debit memorandum, DM; credit memorandum, CM$.$

Dec. $1.$ Paid cash to Riverside Properties for rent, $$1,600\mathrm{.}00.$ C$456.$

$2.$ Paid cash to City Office Source for office supplies, $$216\mathrm{.}00.$ C$457.$

$2.$ The board of directors declared a dividend of $$0\mathrm{.}50$ per share; capital stock issued is $6,000$ shares. M$56.$

$3.$ Received cash on account from Chandler City Schools, covering $5392$ for $$814\mathrm{.}80,$ less $2\%$ sales discount. R$402.$

$3.$ Sold merchandise on account to Pacific Stores, $$4,795\mathrm{.}00,$ plus sales tax. $5395.$

$4.$ Paid cash to Downtown Hardware for miscellaneous expense, $$85\mathrm{.}00.$ C$458.$

$6.$ Recorded cash and credit card sales, $$5,845\mathrm{.}00,$ plus sales tax, $$315\mathrm{.}63$; total, $$6,160\mathrm{.}63.$ TS$45.$

$7.$ Bought $$225\mathrm{.}00$ of office supplies and $$312\mathrm{.}00$ of store supplies from Alpha Supply on account, $$537\mathrm{.}00.$ M$57.$

$8.$ Paid cash on account to Singh Imports, covering P$243$ for $$1,589\mathrm{.}00,$ less $2\%$ discount. C$459.$

$8.$ Sold merchandise on account to Batesville Manufacturing, $$1,208\mathrm{.}00,$ plus sales tax. S$396.$

$8.$ Purchased merchandise on account from Trevino Company, $$4,000\mathrm{.}00,$ less a $40\%$ trade discount. P$245.$

$10.$ Paid cash to Cantrell Energy for electric bill, $$482\mathrm{.}50.$ C$460.$

$10.$ Purchased merchandise on account from Singh Imports, $$3,925\mathrm{.}00.$ P$246.$

$11.$ Received a $$3,000\mathrm{.}00$ check from Pacific Stores. The check pays $$3,061\mathrm{.}22$ of the Dec. $3$ sale on account, $$395,$ less $2\%$ discount. R$403.$

$11.$ Paid cash on account to Klein Industries, $$2,618\mathrm{.}00,$ covering P$240.$ C$461.$

$13.$ Paid cash to City Office Source for store supplies, $$235\mathrm{.}00.$ C$462.$

$13.$ Recorded cash and credit card sales, $$7,125\mathrm{.}00,$ plus sales tax, $$384\mathrm{.}75$; total, $$7,509\mathrm{.}75.$ TS$46.$

$13.$ Purchased merchandise on account from Klein Industries, $$4,958\mathrm{.}00.$ P$247.$

$14.$ Sold merchandise on account to Chandler City Schools, $$5,580\mathrm{.}00.$ Chandler City Schools is exempt from sales tax $5397.$

$14.$ Paid cash to Innovative Communications for advertising, $$325\mathrm{.}00.$ C$463.$

$14.$ Returned $$410\mathrm{.}00$ of merchandise to Klein Industries from P$247.$ DM$14.$

$14.$ Received cash on account from Musheer Orthopedics, $$831\mathrm{.}50,$ covering S$385.$ R$404.$

$15.$ Paid cash on account to Alpha Supply, $$942\mathrm{.}00,$ covering P$241.$ C$464.$

$15.$ Paid cash for liability for employee income tax, $$471\mathrm{.}00,$ social security tax, $$899\mathrm{.}00,$ and Medicare tax, $$210\mathrm{.}25$ total, $$1,580\mathrm{.}25.$ C$465.$

$15.$ Paid cash for semimonthly payroll, $$2,670\mathrm{.}10($total payroll, $$3,528\mathrm{.}00,$ less deductions: employee income tax, $$228\mathrm{.}00$; social security tax, $$218\mathrm{.}74$; Medicare tax, $$51\mathrm{.}16$; health insurance premiums, $$240\mathrm{.}00$; retirement ben" efits, $$120\mathrm{.}00).(466.$

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