The chart of accounts of Domingo Company includes the following selected accounts.

112 ............Accounts Receivable

120 ............Inventory

126 ............Supplies

157 ............Equipment

201 ............Accounts Payable

401 ............Sales Revenue

412 ............Sales Returns and Allowances

505 ............Cost of Goods Sold

610 ............Advertising Expense

In July, the following selected transactions were completed. All purchases and sales were on account. The cost of all merchandise sold was 70% of the sales price.

July 1 Purchased merchandise from Chad Company $7,600.

2 Received freight bill from Pegasus Shipping on Chad purchase $400.

3 Made sales to Effron Company $1,300 and to Pitas Bros. $2,000.

5 Purchased merchandise from Kivlin Company $3,200.

8 Received credit on merchandise returned to Kivlin Company $300.

13 Purchased store supplies from Bowe Supply $910.

15 Purchased merchandise from Chad Company $3,600 and from Goran Company $3,300.

16 Made sales to Felber Company $3,450 and to Pitas Bros. $1,570.

18 Received bill for advertising from Wei Advertisements $600.

21 Made sales to Effron Company $310 and to Musky Company $2,800.

22 Granted allowance to Effron Company for merchandise damaged in shipment $65.

24 Purchased merchandise from Kivlin Company $3,000.

26 Purchased equipment from Bowe Supply $900.

28 Received freight bill from Pegasus Shipping on Kivlin purchase of July 24, $380.

30 Made sales to Felber Company $5,600.

Instructions

(a) Journalize the transactions above in a purchases journal, a sales journal, and a general journal. The purchases journal should have the following column headings: Date, Account Credited (Debited), Ref., Accounts Payable Cr., Inventory Dr., and Other Accounts Dr.

(b) Post to both the general and subsidiary ledger accounts. (Assume that all accounts have zero beginning balances.)

(c) Prove the agreement of the control and subsidiary accounts.