BUS101 Working Papers

65724_01_ch01_p001-023 4/15/09 11:49 AM Page SG-1
Introduction 1
to accounting
Pc oncepts and
pera o c e d u r e s
rs
on
SELF-REVIEW QUIZ 1-1
GRACIE RYAN REAL ESTATE
No eL
a
OWNER’S
ASSETS = LIABILITIES + EQUITY
t F rn Cash +
Computer
Equipment =
Accounts
Payable +
Gracie Ryan,
Capital
TRANSACTION 1
or in
Di g
NEW BALANCE =
R
TRANSACTION 2
s O e So
NEW BALANCE =
tri r sa
TRANSACTION 3
ENDING BALANCE + = +
bu le lu
=
tio t io
n n s
SG-1
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Name __________________________________ Class ____________________ Date ____________________
Pe ASSETS LIABILITIES AND OWNER’S EQUITY
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-2
Pe
65724_01_ch01_p001-023
ar
Di
4/15/09
so
tri
11:49 AM
n
B. BING CO.
bu
L
ASSETS = LIABILITIES + OWNER’S EQUITY
r
No e
Page SG-3
Accounts Cleaning Accounts B. Bing, B. Bing
tio
Cash + Receivable + Equipment = Payable + Capital – Withd. + Revenue – Expenses
n
Beg. Balance $10,000 + $2,500 + $6,500 = $1,000 + $11,800 – $800 + $9,000 – $2,000
R
1.
t F rn
s O e
Balance =
2.
SG-3
or in
sa
Balance =
g
3.
Balance =
4.
Balance =
So
5.
Ending
le lu
Balance + + = + – + –
t
=
io
s n
Name __________________________________ Class ____________________ Date ____________________
65724_01_ch01_p001-023 4/15/09 11:49 AM Page SG-4
Name __________________________________ Class ____________________ Date ____________________
(1)
Pe
ar
so
n
No eL
a
t F rn
or in
(2)
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-4
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Name __________________________________ Class ____________________ Date ____________________
(3)
ASSETS LIABILITIES AND OWNER’S EQUITY
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-5
(A)
Pe
MICHAEL BROWN, ATTORNEY AT LAW
65724_01_ch01_p001-023
ar
Di
Accounts Office Accounts M. Brown, M. Brown
4/15/09
Cash + Receivable + Equipment = Payable + Capital – Withd. + Legal fees – Expenses
so
1.
tri
Balance
11:49 AM
n
2.
bu
Balance
L
3.
r
No e
Page SG-6
Balance
tio
4.
n
Balance
R
5.
SG-6
t F rn
s O e
Balance
6.
or in
sa
Balance
g
7.
Balance
8.
FORMS FOR DEMONSTRATION PROBLEM
Balance
So
9.
Ending
le lu
Balance + + = + – + –
t
=
io
s n
Name __________________________________ Class ____________________ Date ____________________
65724_01_ch01_p001-023 4/15/09 11:49 AM Page SG-7
Name __________________________________ Class ____________________ Date ____________________
DEMONSTRATION PROBLEM (CONTINUED)
B-1
INCOME STATEMENT
FOR MONTH ENDED JUNE 30, 200X
Pe
ar
so
n
B-2
No eL
a
STATEMENT OF OWNER’S EQUITY
t F rn
or in
Di R g
s O e tri r sa So
B-3 bu le lu
tio t
io
BALANCE SHEET
JUNE 30, 200X
ASSETS
n n
LIABILITIES AND OWNER’S EQUITY
SG-7
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Name __________________________________ Class ____________________ Date ____________________
CHAPTER 1
FORMS FOR CLASSROOM DEMONSTRATION EXERCISES SET A OR SET B
1. A. 2. A.
B. B.
Pe
C. C.
D.
E.
ar
F.
so
3. A. 4.
B.
n
L
5. 6.
No e
a
t F rn
7. A.
or in 8. A.
Di g
B. B.
R
C. C.
s O e So
D. D.
tri r sa
E.
F.
bu le lu
9. A. G.
B. H.
tio t
C.
io
D.
n n s
SG-8
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Name __________________________________ Class ____________________ Date ____________________
FORMS FOR EXERCISES
1-1.
A.
B.
C.
Pe 1-2.
ar ASSETS = LIABILITIES + OWNER’S EQUITY
so
A.
B.
C.
n
1-3.
No eL RANGE CO.
a
BALANCE SHEET
t F rn
NOVEMBER 30, 200X
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-9
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Name __________________________________ Class ____________________ Date ____________________
EXERCISES (CONTINUED)
1-4.
Expenses
Pe
–
Revenue
ar
so
Withd. +
B. Bell
n
OWNER’S EQUITY
L
–
No e
Capital
a
B. Bell
t F rn
= LIABILITIES +
or in
Accounts
Payable
Di R g
s O e tri So
=
r sa
+ Receivable + Equipment
Computer
bu le lu
tio t io
Accounts
n
ASSETS
ns
Cash
Balance
Ending
G.
A.
C.
D
E.
B
SG-10
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Name __________________________________ Class ____________________ Date ____________________
EXERCISES (CONCLUDED)
1-5.
(A)
FRENCH REALTY
INCOME STATEMENT
Pe
ar
so
n
(B)
No eL FRENCH REALTY
a
t F rn
or in
Di R g
(C) s O e tri r sa
FRENCH REALTY So
bu le lu
BALANCE SHEET
JUNE 30, 200X
ASSETS
tio t io
n n s
SG-11
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Name __________________________________ Class ____________________ Date ____________________
END OF CHAPTER PROBLEMS
PROBLEM 1A-1 OR PROBLEM 1B-1

MIA’S NAIL SPA
OWNER’S
Pe
ASSETS = LIABILITIES + EQUITY
Store Accounts Mia Annabelle,
ar
Cash + Equipment = Payable + Capital
so
TRANSACTION A
NEW BALANCE
TRANSACTION B
n
NEW BALANCE
TRANSACTION C
L
NEW BALANCE
No e
TRANSACTION D
a
ENDING BALANCE
t F rn
or in
Di
s O e R g SEE’S INTERNET SERVICE
So
BALANCE SHEET
tri r sa
SEPTEMBER 30, 200X
ASSETS
bu le lu
tio t io
n n s
SG-12
Pe
65724_01_ch01_p001-023
ar
RICK FOX
Di
TYPING SERVICE
4/15/09
so
tri
Accounts Office Accounts R. Fox, R. Fox, Typing
11:49 AM
n
bu
A.
L
BALANCE
r
No e
B.
Page SG-13
tio
BALANCE
n
C.
R
BALANCE
t F rn
s O e
D.
BALANCE
or in
SG-13
sa
E.
g
BALANCE
F.
BALANCE
G.
So
BALANCE
H.
le lu
ENDING
t
BALANCE
io
s n
Name __________________________________ Class ____________________ Date ____________________
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Name __________________________________ Class ____________________ Date ____________________
(A)
WEST STENCILING SERVICE
INCOME STATEMENT
Pe
ar
so
n
No eL
a
t F rn
(B)
or in
Di g
R
s O e
tri r sa So
bu le lu
tio t io
n n s
SG-14
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Name __________________________________ Class ____________________ Date ____________________
PROBLEM 1A-4 OR PROBLEM 1B-4 (CONCLUDED)
(C)
BALANCE SHEET
JUNE 30, 200X
Pe ASSETS LIABILITIES AND OWNER’S EQUITY
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-15
TOBEY’S CATERING SERVICE
(A) ASSETS = LIABILITIES + OWNER’S EQUITY
Accounts Accounts J. Tobey, J. Tobey, Catering
Pe
65724_01_ch01_p001-023
10/25
BALANCE
ar
10/27
Di
4/15/09
BALANCE
10/28
so
BALANCE
tri
10/29
11:49 AM
n
BALANCE
bu
11/1
L
BALANCE
r
No e
Page SG-16
11/5
tio
a
BALANCE
n
11/8
R
BALANCE
SG-16
t F rn
s O e
11/10
BALANCE
or in
sa
11/15
g
BALANCE
11/17
BALANCE
11/20
So
BALANCE
11/25
le lu
BALANCE
t
11/28
BALANCE
io
11/30
n
END. BAL.
s
=
Name __________________________________ Class ____________________ Date ____________________
65724_01_ch01_p001-023 4/15/09 11:49 AM Page SG-17
Name __________________________________ Class ____________________ Date ____________________
PROBLEM 1A-5 OR PROBLEM 1B-5 (CONTINUED)
(B)
BALANCE SHEET
OCTOBER 31, 200X
Pe
ar
so
n
No eL
a
t F rn
or in
(C)
Di R g
s O e
So
INCOME STATEMENT
tri r sa
FOR MONTH ENDED NOVEMBER 30, 200X
bu le lu
tio t io
n n s
SG-17
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Name __________________________________ Class ____________________ Date ____________________
(D)
Pe
ar
so
n
No eL
a
(E)
t F rn
BALANCE SHEET
NOVEMBER 30, 200X
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-18
65724_01_ch01_p001-023 4/15/09 11:49 AM Page SG-19
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 1
SUMMARY PRACTICE TEST:
INTRODUCTION TO ACCOUNTING CONCEPTS AND PROCEDURES
Part I Instructions
Fill in the blank(s) to complete the statement.
Pe 1.
2.
was passed to prevent corporate fraud.
– Liabilities = Owner’s Equity
ar
3. The owner’s current investment or equity in the assets of a business is called .
so
4. A list of assets, liabilities, and owner’s equity as of a particular date is reported on a(n)
.
n
5. create an outward or potential outward flow of assets.
6. Revenue earned not on account creates an asset entitled .
L
7. record personal expenses that are not related to the business. They are a subdivision
No e
of owner’s equity.
a
8. The reports how well a business performs for a period of time.
t F rn
9. The is a report that
shows changes in capital.
or in
10. The ending figure for capital from the statement of owner’s equity is placed on the
Di g
.
s O e R
Part II Instructions
tri r
Answer true or false to the following statements.
sa So
1.
bu
Accounts Receivable is a liability.
le lu
tio t
2. Liabilities produce revenue.
io
3. Revenue is an asset.
n
4. Capital means cash.
n
5. Bookkeeping is 50% of accounting.
s
6. The balance sheet lists assets, revenue, and owner’s equity.
7. The balance sheet shows where we are now for a specific period of time.
8. Revenue creates an outward flow of assets.
9. Expenses are a subdivision of owner’s equity.
10. Withdrawals are the only subdivision of owner’s equity.
11. Withdrawals are listed on the income statement.
12. Revenue is a subdivision of owner’s equity.
13. Revenues and withdrawals are listed on the income statement.
14. The income statement helps update the statement of owner’s equity, and the statement of owner’s
equity helps update the balance sheet.
15. Withdrawals are listed on the statement of owner’s equity.
SG-19
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Name __________________________________ Class ____________________ Date ____________________
Part III Instructions

In column B, record the appropriate code(s) that result from recording the transaction in column A.
1. Increase in assets 5. Increase in capital
2. Decrease in assets 6. Increase in revenues
3. Increase in liabilities 7. Increase in expenses
4. Decrease in liabilities 8. Increase in withdrawals
Pe COLUMN A COLUMN B
ar
1. EXAMPLE: Pete Smith invested $5,000 in his business. 1,5
2. Bought computer equipment on account for $600.
so
3. Paid salaries of $70.
4. Bought additional computer equipment for $750 cash.
5. Paid rent expense of $90.
n
6. Received $5,000 in cash from revenue earned.
7. Paid heat expense of $15.
L
8. Earned revenue of $500 that will not be received until next month.
No e
9. Paid amount owed on equipment previously purchased on account.
a
10. Paid for cleaning supplies expense, $15.
11. Customers paid $10 of amount previously owed.
t F rn
12. Bought additional equipment of $1,000, half paid in cash and half charged.
13. Charged customer $100 for services performed.
or in
14. Pete paid home phone bill from the company’s cash.
15. Advertising expense incurred but not to be paid until next month.
Di R g
s O e So
CHAPTER 1 SOLUTIONS TO SUMMARY PRACTICE TEST
Part I
tri r sa
1. The Sarbanes-Oxley Act
bu 5. Expenses
le lu 9. statement of owner’s
tio t
2. Assets 6. Cash equity
io
3. capital 7. Withdrawals 10. balance sheet
4. balance sheet 8. income statement
n n s
SG-20
65724_01_ch01_p001-023 4/15/09 11:49 AM Page SG-21
Name __________________________________ Class ____________________ Date ____________________
Part II
1. false 6. false 11. false

2. false 7. false 12. true
3. false 8. false 13. false
4. false 9. true 14. true
5. false 10. false 15. true
Pe
ar
Part III
so
1. 1,5 6. 1,6 11. 1,2
2. 1,3 7. 7,2 12. 1,2,3
3. 7,2 8. 1,6 13. 1,6
n
4. 1,2 9. 4,2 14. 8,2
5. 7,2 10. 7,2 15. 7,3
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-21
SANCHEZ COMPUTER CENTER
Pe
65724_01_ch01_p001-023
Computer Shop Office Accounts Freedman Freedman,
ar
Di
Cash + Supplies + Equipment + Equipment = Payable + Capital – Withdrawals + Revenue – Expenses
4/15/09
so
BALANCE
tri
b
11:49 AM
n
BALANCE
c
bu
L
BALANCE
r
No e
d
Page SG-22
tio
CONTINUING PROBLEM FOR CHAPTER 1
BALANCE
n
e
R
BALANCE
SG-22
t F rn
s O e
f
BALANCE
or in
sa
g
BALANCE
g
h
BALANCE
i
So
BALANCE
j
le lu
END BAL. + + + = + – + –
t
=
io
s n
Name __________________________________ Class ____________________ Date ____________________
65724_01_ch01_p001-023 4/15/09 11:49 AM Page SG-23
Name __________________________________ Class ____________________ Date ____________________

INCOME STATEMENT
FOR THE MONTH ENDED JULY 31, 200X
Pe
ar
so
n
FOR MONTH ENDED JULY 31, 200X
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
BALANCE SHEET
bu
ASSETS
le lu
JULY 31, 200X
tio t io
n n s
SG-23
65724_02_ch02_p024-049 4/15/09 11:50 AM Page SG-24
Debits and 2
credits:
a Pn a l y z i n g a n d
r eecao r d i n g
b u s irsn e s s
trans ona c t i o n s
No e L
a
t F rn 1. 4.
or in
2. 5.
Di
3.
st Or es S R g
rib al ol
A.
ut
io
1.
e u
Accounts Affected
tio
2.
Category
3.
↑↓
4.
Rules
5.
T Account Update
n n
B. 1. 2. 3. 4. 5.
s
Accounts Affected Category ↑↓ Rules T Account Update
SG-24
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Name __________________________________ Class ____________________ Date ____________________
C. 1. 2. 3. 4. 5.
PeD. 1. 2. 3. 4. 5.
ar
so
n
E. 1. 2. 3. 4. 5.
↑↓
L
Accounts Affected Category Rules T Account Update
No e
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-25
65724_02_ch02_p024-049 4/15/09 11:50 AM Page SG-26
Name __________________________________ Class ____________________ Date ____________________
Cash 111 Accounts Payable 211 Salon Fees 411

4,500 300 300 700 3,500
2,000 100 1,000
Pe
1,000 1,200
300 1,300
ar
2,600
so
Accounts Receivable 121 Pam Jay, Capital 311 Rent Expense 511
1,000 300 4,000 1,200
n
No e
Salon Equipment
L 131 Pam Jay, Withdrawals 321 Salon Supplies Exp. 521
a
700 100 1,300
t F rn
or in
Di g
Salaries Expense 531
s O e R 2,600
tri r sa So
bu le lu
tio t io
n n s
SG-26
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Name __________________________________ Class ____________________ Date ____________________
(1)
Pe
ar
so
n
No eL
(2) a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-27
65724_02_ch02_p024-049 4/15/09 11:50 AM Page SG-28
Name __________________________________ Class ____________________ Date ____________________
(3)
Pe
ar
so
(4)
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-28
65724_02_ch02_p024-049 4/15/09 11:50 AM Page SG-29
Name __________________________________ Class ____________________ Date ____________________
(1,2,3)
511
513
512
514
Pe
Advertising Expense
Telephone Expense
Salaries Expense
ar Gas Expense
so
n
No eL Mel Free, Withdrawals 312
211
311
411
a
t F rn
Delivery Fees Earned
Accounts Payable
Mel Free, Capital
or in
Di R g
s O e tri r sa So
bu le lu
111
112
121
122
tio t io
Accounts Receivable
Office Equipment
Delivery Trucks
n n
Cash
SG-29
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Name __________________________________ Class ____________________ Date ____________________
FORMS FOR DEMONSTRATION PROBLEM (CONTINUED)
(4)
MEL’S DELIVERY SERVICE
TRIAL BALANCE
JULY 31, 200X
Pe
Dr. Cr.
ar
so
n
No eL
a
t F rn
or in
Di R g
(5A)
s O e tri r sa
INCOME STATEMENT So
bu le lu
tio t io
n n s
SG-30
65724_02_ch02_p024-049 4/15/09 11:50 AM Page SG-31
Name __________________________________ Class ____________________ Date ____________________
FORMS FOR DEMONSTRATION PROBLEM (CONCLUDED)
(5B)
Pe
ar
so
n
L
(5C)
No e
a
BALANCE SHEET
JULY 31, 200X
t F rn ASSETS LIABILITIES AND OWNER’S EQUITY
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-31
65724_02_ch02_p024-049 4/15/09 11:50 AM Page SG-32
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 2
1.
Pe
2. A.
ar
so
B.
C.
n
D.
E.
F.
G.
No eL
3.
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
4. 5.
tioA.
B.
t io
n n
C.
D.
s
E.
F.
G.
H.
I.
J.
K.
SG-32
65724_02_ch02_p024-049 4/15/09 11:50 AM Page SG-33
Name __________________________________ Class ____________________ Date ____________________
FORMS FOR EXERCISES
2-1.
Pe
ar
so
n
No eL
a
t F rn
or in
2-2.
1. 2. 3. 4. 5.
Di g
Accounts Affected Category ↑ ↓ Rules T Account Update
s O e R
tri r sa So
bu le lu
tio t io
2-3.
n n
Account Category ↑↓
s
Financial Statement
SG-33
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Name __________________________________ Class ____________________ Date ____________________
2-4.
Dr. Cr.
A. 8 1
B.
Pe
C.
D.
E.
ar
F.
G.
so
H.
I.
2-5.
n
(1)
No eL HALL’S CLEANERS
a
INCOME STATEMENT
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
(2) tio t io
n
HALL’S CLEANERS
n s
SG-34
65724_02_ch02_p024-049 4/15/09 11:50 AM Page SG-35
Name __________________________________ Class ____________________ Date ____________________
(3)
HALL’S CLEANERS
BALANCE SHEET
JULY 31, 200X
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-35
65724_02_ch02_p024-049 4/15/09 11:50 AM Page SG-36
Name __________________________________ Class ____________________ Date ____________________
Pe
ar
so
T Account Update
n
No eL
a
t F rn
or in
Rules
Di R g
Inc. Dec.
s O e So
↓
tri r sa
↑
bu le lu
Category
tio t io
n n
Accounts Affected
s
D.
A.
C.
B.
E.
F.
SG-36
65724_02_ch02_p024-049 4/15/09 11:50 AM Page SG-37
Name __________________________________ Class ____________________ Date ____________________

Cash 111 Bernie Pillows, Withdrawals 312
Pe Office Equipment 121 Consulting Fees Earned 411
ar
so
n
Accounts Payable 211 Advertising Expense 511
No eL
a
t F rn
Bernie Pillows, Capital 311 Rent Expense 512
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-37
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Name __________________________________ Class ____________________ Date ____________________

(A)
Cash 111 Accounts Payable 211 Fees Earned 411
Pe
ar
Accounts Receivable 112 Barry Joy, Capital 311 Rent Expense 511
so
n
Office Equipment
No eL 121 Barry Joy, Withdrawals 312 Utilities Expense 512
a
t F rn
or in
Di R g
s O e
(B)
tri r sa
BARRY’S CLEANING SERVICE
TRIAL BALANCE
So
bu le lu
MAY 31, 200X
Dr. Cr.
tio t io
n n s
SG-38
65724_02_ch02_p024-049 4/15/09 11:50 AM Page SG-39
Name __________________________________ Class ____________________ Date ____________________

(A)
GRACIE LANTZ, ATTORNEY AT LAW
INCOME STATEMENT
FOR MONTH ENDED MAY 31, 200X
Pe
ar
so
n
No eL
a
(B)
t F rn
or in
FOR MONTH ENDED MAY 31, 200X
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-39
65724_02_ch02_p024-049 4/15/09 11:50 AM Page SG-40
Name __________________________________ Class ____________________ Date ____________________

(C)
Pe
ar
so
n
No eL
a
t F rn
or in
BALANCE SHEET
MAY 31, 200X
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
ASSETS
SG-40
65724_02_ch02_p024-049 4/15/09 11:50 AM Page SG-41
Name __________________________________ Class ____________________ Date ____________________

(1,2,3)
Pe
511
512
513
514
ar
Advertising Expense
Telephone Expense
Salaries Expense
Gas Expense
so
n
No eL
a
211
311
A. Angel, Withdrawals 312
411
t F rn Delivery Fees Earned
or in
Accounts Payable
A. Angel, Capital
Di R g
s O e tri r sa So
bu le lu
tio t io
111
112
121
122
n n
Accounts Receivable
Office Equipment
Delivery Trucks
s
Cash
SG-41
65724_02_ch02_p024-049 4/15/09 11:50 AM Page SG-42
Name __________________________________ Class ____________________ Date ____________________
PROBLEM 2A-5 OR PROBLEM 2-B5 (CONTINUED)

(4)
ANGEL’S DELIVERY SERVICE
TRIAL BALANCE
MARCH 31, 200X
Dr. Cr.
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e
(5A)
tri r sa
INCOME STATEMENT
So
bu le lu
FOR MONTH ENDED MARCH 31, 200X
tio t io
n n s
SG-42
65724_02_ch02_p024-049 4/15/09 11:50 AM Page SG-43
Name __________________________________ Class ____________________ Date ____________________

(5B)
FOR MONTH ENDED MARCH 31, 200X
Pe
ar
so
n
(5C)
No eL ANGEL’S DELIVERY SERVICE
a
BALANCE SHEET
t F rn
MARCH 31, 200X
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-43
65724_02_ch02_p024-049 4/15/09 11:50 AM Page SG-44
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 2
DEBITS AND CREDITS: ANALYZING AND RECORDING
BUSINESS TRANSACTIONS
Part I Instructions
Pe
1. Financial reports do not contain or .
ar
2. The right side of any T account is called the .
3. Assets are increased by .
so
4. The process of balancing an account involves .
5. Transaction analysis charts are an aid in recording .
6. The indicates the names and numbering
n
system of accounts.
7. A(n) is a group of accounts.
L
8. A(n) is an informal report that lists accounts and their
balances.
No e
9. Withdrawals are increased by .
a
10. The income statement, statement of owner’s equity, and balance sheet may be prepared from
t F rn
a(n) .
11. Cash, Accounts Receivable, and Equipment are examples of .
or in
12. Increasing expenses ultimately cause owner’s equity to .
13. An increase in rent expense is a(n) by the rules of debits and credits.
Di g
14. A debit to one asset and a credit to another asset for the same transaction reflect
R
a(n) in assets.
s O e
15.
So
The category of accounts receivable is a(n) .
tri r sa
bu le lu
Bea Paul opened a shuttle service company. From the following chart of accounts, indicate in column B (by
account number) which account (s) will be debited or credited as related to the transaction in column A.
tio t io
n n s
SG-44
65724_02_ch02_p024-049 4/15/09 11:50 AM Page SG-45
Name __________________________________ Class ____________________ Date ____________________
Chart of Accounts
ASSETS LIABILITIES EXPENSES

10 Cash 50 Accounts Payable 80 Advertising
20 Accounts Receivable 90 Gas
30 Equipment OWNER’S EQUITY 100 Salaries
40 Shuttle Bus 60 B. Paul, Capital 110 Telephone
62 B. Paul, Withdrawals
Pe REVENUE
70 Taxi Fees Earned
ar COLUMN A COLUMN B
so
DEBIT(S) CREDIT(S)
1. EXAMPLE: Bea Paul invested $40,000 in the shuttle service. 10 60
n
2. Purchased a shuttle bus on account for $25,000.
L
3. Bought equipment on account for $3,000.
No e
4. Advertising bill received, but not paid until next month, $60.
a
5. Bea paid home telephone bill from company checkbook, $20.
6.
t F rn
Collected $100 in cash from daily shuttle fees earned.
or in
7. Customer charged a shuttle ride of $20.
8. Received partial payment for Transaction #7 of $10.
9.
Di R g
Paid business telephone bill, $32.
10.
11.
s O e tri
Purchased additional equipment for cash, $550.
r
Paid shuttle driver salaries of $150.
sa So
12.
bu
Drove customer on account to local train station for $6.
le lu
tio t
13. Received $5 from customer who hired a shuttle for ride across town.
14. Collected from past charged revenue, $15.
n io
15. Bought office equipment on account for $110.

n s
1. There are no debit and credit columns found on the three financial statements.
2. A trial balance could balance but be wrong.
3. Withdrawals are listed on the credit column of the trial balance.
4. Double entry bookkeeping results in a system where the sum of all the debits is equal to the sum of all
the credits.
5. The ledger is numbered like a textbook.
SG-45
65724_02_ch02_p024-049 4/15/09 11:50 AM Page SG-46
Name __________________________________ Class ____________________ Date ____________________
6. Withdrawals are always increased by credits.

7. An expense could create a liability.
8. A shift in assets means the total of assets must change.
9. The rules of debit and credit are constantly changing.
10. The transaction analysis chart is a teaching device.
Pe
11. The chart of accounts makes locating and identifying accounts easier.
12. The left side of any account is a credit.
ar
13. A debit means all accounts are decreasing.
14. Financial statements are prepared from a trial balance.
15.
16. so
The statement of owner’s equity is prepared before the income statement.
Liabilities increase by credits.
17.
n
Footings aid in balancing accounts.
L
18. Withdrawals are listed on the income statement.
No e
19. The balance sheet contains the old figure for capital.
a
20. Think of a credit as always meaning something good.
t F rn
CHAPTER 2
SOLUTIONS TO SUMMARY PRACTICE TEST
Part I
or in
1.
Di
debits/credits
R g 6. chart of accounts 11. assets
s O e
2. credit side 7. ledger (general) 12. decrease
tri So
3. debits 8. trial balance 13. debit
4. footings
r 9. debits
sa 14. shift
bu
5. 10. 15.
le lu
business transactions trial balance asset
Part II
Debit Credit
tio Debit Credit
t Debit Credit
io
n
1. 10 60 6. 10 70 11. 100 10
n
2. 40 50 7. 20 70 12. 20 70
s
3. 30 50 8. 10 20 13. 10 70
4. 80 50 9. 110 10 14. 10 20
5. 62 10 10. 30 10 15. 30 50
Part III
1. true 6. false 11. true 16. true
2. true 7. true 12. false 17. true
3. false 8. false 13. false 18. false
4. true 9. false 14. true 19. false
5. false 10. true 15. false 20. false
SG-46
Pe
Cash 1000 Accounts Receivable 1020 Supplies 1030 Computer Shop Equipment 1080
65724_02_ch02_p024-049
Bal. 3,850 Bal. 250 Bal. 1,200
ar
Di
4/15/09
so
tri
Office Equipment 1090 Accounts Payable 2000 Freedman, Capital 3000
11:50 AM
n
Bal. 600 335 Bal. 4,500 Bal.
bu
L
r
No e
Page SG-47
tio
a
n
Freedman, Withdrawals 3010 Service Revenue 4000 Advertising Expense 5010 Rent Expense 5020
R
1,650 Bal.
Bal. 100 Bal. 400
t F rn
s O e
or in
SG-47
sa
g
Utilities Expense 5030 Phone Expense 5040 Supplies Expense 5050 Insurance Expense 5060
Bal. 85
So
le lu
t
Postage Expense 5070
io
s n
Name __________________________________ Class ____________________ Date ____________________
65724_02_ch02_p024-049 4/15/09 11:50 AM Page SG-48
Name __________________________________ Class ____________________ Date ____________________

TRIAL BALANCE
AUGUST 31, 200X
Dr. Cr.
Pe
ar
so
n
No eL
a
t F rn
or in
Di g
R
INCOME STATEMENT
s O e
FOR THE TWO MONTHS ENDED AUGUST 31, 200X
tri r sa So
bu le lu
tio t io
n n s
SG-48
65724_02_ch02_p024-049 4/15/09 11:50 AM Page SG-49
Name __________________________________ Class ____________________ Date ____________________

FOR THE TWO MONTHS ENDED AUGUST 31, 200X
Pe
ar
so SANCHEZ COMPUTER CENTER
n
BALANCE SHEET
AUGUST 31, 200X
L
No e
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-49
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-50
Beginning the 3
Accounting Cycle:
JoP urnalizing,
P oesat i n g , a n d t h e
T r i arsl B a l a n c e
on
L
No e
a
LOWE’S REPAIR SERVICE
GENERAL JOURNAL
t F rn
PAGE 1
or in
Date Account Titles and Description PR Dr. Cr.
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-50
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-51
Name __________________________________ Class ____________________ Date ____________________
LOWE’S REPAIR SERVICE

GENERAL JOURNAL
PAGE 1 (Cont.)
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-51
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-52
Name __________________________________ Class ____________________ Date ____________________
CLARK’S WORD PROCESSING SERVICES

GENERAL JOURNAL
PAGE 1
Date
200X Account Titles and Description PR Dr. Cr.
May
Pe 1 Cash
Brenda Clark, Capital
10 0 0 0 00
10 0 0 0 00
ar
Initial investment of cash by owner
so
1 Word Processing Equipment 6 0 0 0 00
Cash 1 0 0 0 00
n
Accounts Payable 5 0 0 0 00
Purchase of equip. from Ben Co.
1 Prepaid Rent
Cash
No eL 1 2 0 0 00
1 2 0 0 00
a
Rent paid in advance (3 months)
t F rn
3 Office Supplies 6 0 0 00
or in
Accounts Payable 6 0 0 00
Purchase of supplies on acct. from Norris
Di R g
s O e
7 Cash 3 0 0 0 00
So
Word Processing Fees 3 0 0 0 00
tri r
Cash received for services rendered
sa
13 Office Salaries Expense
Cash bu le lu
6 5 0 00
6 5 0 00
tio
Payment of office salaries
t io
n n
18 Advertising Expense 2 5 0 00
s
Accounts Payable 2 5 0 00
Bill received but not paid from AI’s News
20 Brenda Clark, Withdrawals 6 2 5 00

Cash 6 2 5 00
Personal withdrawal of cash
22 Accounts Receivable 5 0 0 0 00
Word Processing Fees 5 0 0 0 00
Billed Morris Co. for fees earned
SG-52
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-53
Name __________________________________ Class ____________________ Date ____________________
CLARK’S WORD PROCESSING SERVICES

GENERAL JOURNAL
PAGE 2
Date
200X Account Titles and Description PR Dr. Cr.
May 27 Office Salaries Expense 6 5 0 00
Pe
Cash 6 5 0 00
Payment of office salaries
ar
28 Accounts Payable 2 5 0 0 00
Cash 2 5 0 0 00
Paid half the amount owed Ben Co.
so 29 Telephone Expense
Cash
2 2 0 00
2 2 0 00
n
Paid telephone bill
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-53
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-54
Name __________________________________ Class ____________________ Date ____________________
PARTIAL LEDGER OF CLARK’S WORD PROCESSING SERVICE
CASH ACCOUNT NO. 111

Balance
Date Explanation Post Debit Credit
Ref. Debit Credit
Pe
ar
so
n
No eL
a
t F rn
ACCOUNTS RECEIVABLE ACCOUNT NO. 112
Balance
or in
Ref. Debit Credit
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-54
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-55
Name __________________________________ Class ____________________ Date ____________________
OFFICE SUPPLIES ACCOUNT NO. 114

Balance
Ref. Debit Credit
Pe PREPAID RENT ACCOUNT NO. 115
ar
Balance
so
Ref. Debit Credit
n WORD PROCESSING EQUIPMENT ACCOUNT NO. 121
L
Balance
No e
Ref. Debit Credit
a
t F rn
or in ACCOUNTS PAYABLE ACCOUNT NO. 211
Di g
Balance
Date
s O e R
Explanation Post Debit Credit
So
Ref. Debit Credit
tri r sa
bu le lu
tio t io
n n s
SG-55
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-56
Name __________________________________ Class ____________________ Date ____________________
BRENDA CLARK, CAPITAL ACCOUNT NO. 311

Balance
Ref. Debit Credit
Pe BRENDA CLARK, WITHDRAWALS ACCOUNT NO. 312
ar
Balance
so
Ref. Debit Credit
n WORD PROCESSING FEES ACCOUNT NO. 411
L
Balance
No e
a
Ref. Debit Credit
t F rn
or in OFFICE SALARIES EXPENSE ACCOUNT NO. 511
Di R g
Balance
s O e
So
Ref. Debit Credit
tri r sa
bu le lu
tio t io
n n s
SG-56
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-57
Name __________________________________ Class ____________________ Date ____________________
ADVERTISING EXPENSE ACCOUNT NO. 512

Balance
Ref. Debit Credit
Pe TELEPHONE EXPENSE ACCOUNT NO. 513
ar
Balance
so
Ref. Debit Credit
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-57
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-58
Name __________________________________ Class ____________________ Date ____________________
1.
Pe
ar
so
n
No eL
a
t F rn
or in
GENERAL JOURNAL
Di
2.
g
PAGE 4
Date
s O e R
Account Titles and Description PR Dr. Cr.
tri r sa So
bu le lu
tio t io
n n s
SG-58
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-59
Name __________________________________ Class ____________________ Date ____________________

(A, B)
ABBY’S EMPLOYMENT AGENCY
GENERAL JOURNAL
PAGE 1
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
SG-59
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-60
Name __________________________________ Class ____________________ Date ____________________
GENERAL LEDGER OF ABBY’S EMPLOYMENT AGENCY

Balance
Pe
Ref. Debit Credit
ar
so
n
No eL ACCOUNTS RECEIVABLE ACCOUNT NO. 112
a
Balance
t F rn
Ref. Debit Credit
or in
Di R g
s O e
SUPPLIES ACCOUNT NO. 131
tri So
Balance
Date Explanation
r Post Debit
sa Credit
bu
Ref. Debit Credit
le lu
tio
EQUIPMENT
t io
ACCOUNT NO. 141
n n
Balance
s
Ref. Debit Credit
SG-60
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-61
Name __________________________________ Class ____________________ Date ____________________
ACCOUNTS PAYABLE ACCOUNT NO. 211

Balance
Ref. Debit Credit
Pe
ar A. TODD, CAPITAL ACCOUNT NO. 311
so
Balance
Ref. Debit Credit
n
No eL
a
A. TODD, WITHDRAWALS ACCOUNT NO. 321
t F rn
Balance
Ref. Debit Credit
or in
Di R g EMPLOYMENT FEES EARNED ACCOUNT NO. 411
Date
s O e tri
Explanation
r
Post
Ref.
sa
Debit
So
Credit
Debit
Balance
Credit
bu le lu
tio t io
n n s
SG-61
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-62
Name __________________________________ Class ____________________ Date ____________________
WAGE EXPENSE ACCOUNT NO. 511

Balance
Ref. Debit Credit
Pe
ar TELEPHONE EXPENSE ACCOUNT NO. 521
so
Balance
Ref. Debit Credit
n
No eL ADVERTISING EXPENSE ACCOUNT NO. 531
Balance
a
t F rn
Ref. Debit Credit
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-62
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-63
Name __________________________________ Class ____________________ Date ____________________
ABBY’S EMPLOYMENT AGENCY

TRIAL BALANCE
MARCH 31, 200X
Dr. Cr.
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-63
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-64
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 3
1. A. E.
B. F.
C. G.
Pe
D. H.
I.
2. A.
ar
B.
C. so
n
L
3.
No e
a
Balance
t F rn
Ref. Debit Credit
or in
Di R g
s O e tri r sa So
bu le lu
4.
LEE CO.
tio t
TRIAL BALANCE
io
OCTOBER 31, 200X
n
Dr. Cr.
n s
SG-64
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-65
Name __________________________________ Class ____________________ Date ____________________
FORMS FOR CLASSROOM DEMONSTRATION EXERCISES SET A OR SET B (CONCLUDED)
5.
Pe
ar
so
n
FORMS FOR EXERCISES
L
3-1.
No e
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
SG-65
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-66
Name __________________________________ Class ____________________ Date ____________________
3-2.
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-66
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-67
Name __________________________________ Class ____________________ Date ____________________
3-3.
200X
Pe
April 6 Cash 15 0 0 0 —
A. King, Capital 15 0 0 0 —
Cash investment
ar 14 Equipment 9 0 0 0 —
so
Cash 4 0 0 0 —
Accounts Payable 5 0 0 0 —
n
Purchase of Equipment
L
No e
Balance
a
Ref. Debit Credit
t F rn
or in
Di g
EQUIPMENT ACCOUNT NO. 121
R
Balance
s O e So
tri r sa
Ref. Debit Credit
bu le lu
t
Date tio
io
Balance
n n
Ref. Debit Credit
A. KING, CAPITAL ACCOUNT NO. 311 s

Balance
Ref. Debit Credit
SG-67
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-68
Name __________________________________ Class ____________________ Date ____________________
3-4.
(A) PAGE 1
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
(B)
n n
Balance
s
Ref. Debit Credit
Balance
Ref. Debit Credit
SG-68
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-69
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar
Balance
so
Ref. Debit Credit
n
No eL J. LOWE, CAPITAL ACCOUNT NO. 311
a
Balance
t F rn
Ref. Debit Credit
or in
Di R g
J. LOWE, WITHDRAWALS ACCOUNT NO. 312
s O e
Balance
tri sa So
r
Ref. Debit Credit
bu le lu
tio
FEES EARNED
t io
ACCOUNT NO. 411
n n
Balance
s
Ref. Debit Credit
SALARIES EXPENSE ACCOUNT NO. 511

Balance
Ref. Debit Credit
SG-69
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-70
Name __________________________________ Class ____________________ Date ____________________
(C)
LOWE COMPANY
TRIAL BALANCE
JULY 31, 200X
Pe
Dr. Cr.
ar
so
n
No eL
3-5.
a
t F rn
SUNG CO.
TRIAL BALANCE
or in
MARCH 31, 200X
Dr. Cr.
Di R g
s O e tri r sa So
bu le lu
tio t io
n n
3-6.
s
Dr. Cr.
SG-70
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-71
Name __________________________________ Class ____________________ Date ____________________

JACK’S CLEANING SERVICE
GENERAL JOURNAL
PAGE 1
Pe Date Account Titles and Description PR Dr. Cr.
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
SG-71
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-72
Name __________________________________ Class ____________________ Date ____________________
JACK’S CLEANING SERVICE

GENERAL JOURNAL
PAGE 2
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-72
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-73
Name __________________________________ Class ____________________ Date ____________________

(A, B)
BETTY’S ART STUDIO
GENERAL JOURNAL
PAGE 1
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
SG-73
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-74
Name __________________________________ Class ____________________ Date ____________________

GENERAL LEDGER OF BETTY’S ART STUDIO
Balance
Ref. Debit Credit
Pe
ar
so
n
No eL
a
t F rn
Balance
Ref. Debit Credit
or in
Di R g
s O e sa So
PREPAID RENT ACCOUNT NO. 114
tri r Balance
bu
le lu
Ref. Debit Credit
tio t io
ART SUPPLIES
n ACCOUNT NO. 121
n s
Balance
Ref. Debit Credit
SG-74
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-75
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar ACCOUNTS PAYABLE ACCOUNT NO. 211
so
Balance
Ref. Debit Credit
n
No eL
a
BETTY RICE, CAPITAL ACCOUNT NO. 311
t F rn
Balance
Ref. Debit Credit
or in
Di R g
s O e sa So
BETTY RICE, WITHDRAWALS ACCOUNT NO. 312
tri r Balance
bu
le lu
Ref. Debit Credit
tio t io
n n s
SG-75
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-76
Name __________________________________ Class ____________________ Date ____________________
ART FEES EARNED ACCOUNT NO. 411

Balance
Ref. Debit Credit
Pe
ar ELECTRICAL EXPENSE ACCOUNT NO. 511
so
Balance
Ref. Debit Credit
n
No eL
a
t F rn
Balance
Ref. Debit Credit
or in
Di R g
s O e sa So
TELEPHONE EXPENSE ACCOUNT NO. 531
tri r Balance
bu
le lu
Ref. Debit Credit
tio t io
n n s
SG-76
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-77
Name __________________________________ Class ____________________ Date ____________________
(C)
BETTY’S ART STUDIO
TRIAL BALANCE
JUNE 30, 200X
Pe
Dr. Cr.
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-77
65724_03_ch03_p050-096 4/16/09 2:42 PM Page SG-78
Name __________________________________ Class ____________________ Date ____________________

(A, B)
A. FRENCH’S PLACEMENT AGENCY
GENERAL JOURNAL
PAGE 1
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-78
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-79
Name __________________________________ Class ____________________ Date ____________________
GENERAL LEDGER OF A. FRENCH’S PLACEMENT AGENCY

Balance
Pe
Ref. Debit Credit
ar
so
n
No eL
a
Date
t F rn
Balance
or in
Ref. Debit Credit
Di R g
s O e tri r
SUPPLIES
sa So ACCOUNT NO. 131
bu
Balance
le lu
Ref. Debit Credit
tio t io
EQUIPMENT
n n
ACCOUNT NO. 141
s
Balance
Ref. Debit Credit
SG-79
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-80
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar
so A. FRENCH, CAPITAL ACCOUNT NO. 311
Balance
n
Ref. Debit Credit
No eL
a
t F rn
A. FRENCH,WITHDRAWALS ACCOUNT NO. 312
or in
Balance
Ref. Debit Credit
Di R g
s O e tri r sa So
bu
PLACEMENT FEES EARNED
le lu
ACCOUNT NO. 411
tio t
Balance
io
Ref. Debit Credit
n n s
SG-80
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-81
Name __________________________________ Class ____________________ Date ____________________
WAGE EXPENSE ACCOUNT NO. 511

Balance
Ref. Debit Credit
Pe
ar TELEPHONE EXPENSE ACCOUNT NO. 521
so
Balance
Ref. Debit Credit
n
a
Balance
t F rn
Ref. Debit Credit
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-81
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-82
Name __________________________________ Class ____________________ Date ____________________
(C)
A. FRENCH’S PLACEMENT AGENCY
TRIAL BALANCE
JUNE 30, 200X
Pe
Dr. Cr.
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-82
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-83
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 3
BEGINNING THE ACCOUNTING CYCLE: JOURNALIZING,
POSTING, AND THE TRIAL BALANCE
Part I Instructions
Pe
1. A fiscal year runs for __________________ months.
ar
2. __________________ __________________ are prepared for parts of a fiscal year (monthly, quarterly, etc.).
3. The __________________ __________________ __________________ eliminates the need for footings.
so
4. The positive balance of each account is referred to as its __________________ __________________.
5. The process of recording transactions in a journal is called __________________.
n
6. Entries are journalized in __________________ __________________.
7. A ledger is often called a(n) __________________ __________________ __________________
L
__________________ .
No e
8. The __________________ portion of a journal entry is indented and placed below the
a
__________________ portion.
t F rn
9. A journal entry requiring three or more accounts is called a(n) __________________ __________________
__________________.
or in
10. Accounts receivable is a(n) __________________ on the balance sheet.
11. When supplies are used up or consumed they become a(n) __________________.
Di g
12. The book of original entry usually refers to a(n) __________________.
13.
s O e R
The process of transferring information from a journal to a ledger is called __________________.
14.
tri So
__________________ __________________ deals with the process of updating the PR of the journal from
r sa
the account number of the ledger to indicate to which account in the ledger information has been
bu le lu
posted.
15. Recording $995.00 as $99.50 is an example of a(n) __________________.
tio t io
n n s
SG-83
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-84
Name __________________________________ Class ____________________ Date ____________________
Match the term in column A to the definition, example, or phrase in column B. Be sure to use a letter
only once.
COLUMN A COLUMN B
g 1. EXAMPLE: Book of original entry a. 243 — 2430
Pe 2. Non-Business Expense b. Transferring information from a general

journal to a ledger
3. Slide
ar
c. Chronological order
4. Transposition
d. Increased by a credit
so
5. Posting
e. Withdrawal
6. General Journal
f. Compound journal entry
7. Cross-reference
n
g. General journal
8. Journalizing
h. Rearrangement of digits of a number by
L
9. Balance Sheet prepared monthly
accident
No e
10. A fiscal year
i. Updating PR column of journal from
a
ledger account
t F rn
j. Trial balance
k. Place to record transactions
or in
l. Accounting cycle
Di g
m. Accounting period
R
n. Interim statements

s O e tri r sa So
bu le lu
tio t
1. A slide cannot affect position of numbers.
io
2. The totals of a trial balance may possibly not balance due to transpositions.
n n
3. Withdrawals has a normal balance of a credit.
s
4. The running balance of an account can be kept in a four-column account.
5. The journal links debits and credits in alphabetical order.
6. The ledger accumulates information from the journal.
7. The post reference column of a ledger records the account number of that account.
8. An accounting cycle must be from January 1 to December 31.
9. The ledger is the book of original entry.
10. The income statement is prepared for a specific accounting period.
11. Interim statements are prepared for an entire fiscal year.
12. A calendar year could be a fiscal year.
13. 390 written by mistake as 3,900 is an example of a slide.
SG-84
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-85
Name __________________________________ Class ____________________ Date ____________________
14. If the totals of a trial balance balance, the individual balance of items must be correct.
15. The equality of debits and credits on a trial balance does not guarantee that transactions have been
properly recorded.
16. The trial balance is prepared from the journal.
17. Cross-referencing means never updating the post reference column of the journal.
18. Journals and ledgers are always in the same book.
Pe19.
20.
The normal balance of each account is located on the same side that increases the acccount.
Ruling of four-column accounts is eliminated.
ar
so
CHAPTER 3
Part I
n
1.
2.
12
No eL
Interim statements
6.
7.
chronological order
book of final entry
11.
12.
expense
journal
a
3. four-column ledger 8. credit, debit 13. posting
t F rn
4. normal balance 9. compound journal entry 14. Cross-reference
5. journalizing 10. asset 15. slide
or in
Di g
Part II
1. g
s O e R 6. k
So
2. 7.
tri
e i
3. a 8. c
r sa
bu
4. h 9. n
le lu
5. b 10. m
Part III
tio t io
1. false 6. true
n11. false 16. false
n s
2. true 7. false 12. true 17. false
3. false 8. false 13. true 18. false
4. true 9. false 14. false 19. true
5. false 10. true 15. true 20. true
SG-85
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-86
Name __________________________________ Class ____________________ Date ____________________

GENERAL JOURNAL
PAGE 1
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-86
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-87
Name __________________________________ Class ____________________ Date ____________________

GENERAL JOURNAL
PAGE 1 (Cont.)
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-87
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-88
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
9/1 0X Balance forward ⻬ 2 8 6 5 00
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-88
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-89
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
9/1 0X Balance forward ⻬ 8 5 0 00
Pe
ar PREPAID RENT ACCOUNT NO. 1025
so
Balance
Ref. Debit Credit
n
No eL
a
t F rn SUPPLIES ACCOUNT NO. 1030
or in
Balance
Di
Ref. Debit Credit
R g
s O e tri r sa So
bu le lu
tio
COMPUTER SHOP EQUIPMENT
t io
ACCOUNT NO. 1080
n n
Balance
s
Ref. Debit Credit
9/1 0X ⻬ 1 2 0 0 00
SG-89
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-90
Name __________________________________ Class ____________________ Date ____________________
OFFICE EQUIPMENT ACCOUNT NO. 1090

Balance
Ref. Debit Credit
Pe
so
Balance
Ref. Debit Credit
n
No eL
a
t F rn
FREEDMAN, CAPITAL ACCOUNT NO. 3000
or in
Balance
Ref. Debit Credit
Di
9/1 0X Balance forward
R g
⻬ 4 5 0 0 00
s O e tri r sa So
bu le lu
tio t io
n n
FREEDMAN, WITHDRAWALS ACCOUNT NO. 3010
s
Balance
Ref. Debit Credit
SG-90
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-91
Name __________________________________ Class ____________________ Date ____________________
SERVICE REVENUE ACCOUNT NO. 4000

Balance
Ref. Debit Credit
Pe
ar
so ADVERTISING EXPENSE ACCOUNT NO. 5010
n Balance
L
Ref. Debit Credit
No e
a
t F rn
or in
Di R g
s O e tri
RENT EXPENSE
r sa So
ACCOUNT NO. 5020
Balance
bu le lu
Ref. Debit Credit
⻬
t
9/1 0X Balance forward 4 0 0 00
tio io
n n s
SG-91
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-92
Name __________________________________ Class ____________________ Date ____________________
UTILITIES EXPENSE ACCOUNT NO. 5030

Balance
Ref. Debit Credit
9/1 0X Balance forward ⻬ 8 5 00
Pe
ar
so
n
PHONE EXPENSE ACCOUNT NO. 5040
Date
No eL
Balance
a
Ref. Debit Credit
t F rn
or in
Di R g
s O e
SUPPLIES EXPENSE ACCOUNT NO. 5050
Date
tri
Explanation
r Post Debit
sa So
Credit
Balance
bu le lu
Ref. Debit Credit
tio t io
n n s
SG-92
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-93
Name __________________________________ Class ____________________ Date ____________________
INSURANCE EXPENSE ACCOUNT NO. 5060
Balance
Ref. Debit Credit
Pe
ar
so
POSTAGE EXPENSE ACCOUNT NO. 5070
Balance
n
Ref. Debit Credit
⻬
L
9/1 0X Balance forward 5 0 00
No e
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-93
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-94
Name __________________________________ Class ____________________ Date ____________________

TRIAL BALANCE
SEPTEMBER 30, 200X
Dr. Cr.
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-94
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-95
Name __________________________________ Class ____________________ Date ____________________

INCOME STATEMENT
FOR THE QUARTER ENDED 9/30/0X
Pe
ar
so
n
No eL
a
t F rn
or in
FOR THE QUARTER ENDED 9/30/0X
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-95
65724_03_ch03_p050-096 4/15/09 11:50 AM Page SG-96
Name __________________________________ Class ____________________ Date ____________________
Pe
ar
so
n
No eL
a
t F rn
BALANCE SHEET
or in
9/30/0X
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
ASSETS
SG-96
65724_04_ch04_p097-116 4/15/09 11:50 AM Page SG-97
The Accounting 4
Cycle Continued:
PP
W
reparing
eao r k s h e e t s
a nrd
s Financial
S t aotne m e n t s
No e L
a
t F rn
Use one of the blank fold-out worksheets that accompanied your textbook.
or in
Di R g
st Or es S
rib al ol
ut
io
e u tio
n n s
SG-97
65724_04_ch04_p097-116 4/15/09 11:50 AM Page SG-98
Name __________________________________ Class ____________________ Date ____________________
(1)
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
(2)
s O e tri r sa So
bu le lu
tio t io
n n s
SG-98
65724_04_ch04_p097-116 4/15/09 11:50 AM Page SG-99
Name __________________________________ Class ____________________ Date ____________________
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n
ASSETS
s
(3)
SG-99
65724_04_ch04_p097-116 4/15/09 11:50 AM Page SG-100
Name __________________________________ Class ____________________ Date ____________________
(1)
(2)
FROST COMPANY
INCOME STATEMENT
Pe
FOR MONTH ENDED DECEMBER 31, 200X
ar
so
n
No eL
a
t F rn
or in
(2)
Di R g
s O e So
FROST COMPANY
tri r sa
bu le lu
tio t io
n n s
SG-100
65724_04_ch04_p097-116 4/15/09 11:50 AM Page SG-101
Name __________________________________ Class ____________________ Date ____________________
DEMONSTRATION PROBLEM (CONCLUDED)
(2)
Pe
ar
so
n
No eL
a
t F rn
DECEMBER 31, 200X
or in
FROST COMPANY
BALANCE SHEET
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
ASSETS
SG-101
65724_04_ch04_p097-116 4/15/09 11:50 AM Page SG-102
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 4
1. A.
B.
Pe 1.
Accounts Affected
2.
Category ↑
3.
↓
4.
Rules
5.
T Account
ar
so
n
C.
No eL
a
2. A.
B. t F rn
1.
or in 2.
↑
3.
↓
4. 5.
Di
Accounts Affected Category Rules T Account
s O e R g
tri r sa So
C.
bu le lu
3. A. ____________________
B. ____________________ tio t io
C.
n n s
1. 2. 3. 4. 5.
Accounts Affected Category ↑ ↓ Rules T Account
D.
SG-102
65724_04_ch04_p097-116 4/15/09 11:50 AM Page SG-103
Name __________________________________ Class ____________________ Date ____________________
4. A.
1. 2. 3. 4. 5.
Accounts Affected Category ↑ ↓ Rules T Account
Pe B.
ar
5.
so
A. ________________ H. ________________
B. ________________ I. ________________
C. ________________ J. ________________
n
D. ________________ K. ________________
E. ________________ L. ________________
L
F. ________________ M. ________________
No e
G. ________________ N. ________________
a
6.
t F rn
A.
B.
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-103
65724_04_ch04_p097-116 4/15/09 11:50 AM Page SG-104
Name __________________________________ Class ____________________ Date ____________________
FORMS FOR EXERCISES
4-1.
Account Category Normal Financial
Balance Statement(s)
Found on
Pe
ar
so
n
4-2.
Accounts Affected
No eL Category ↑ ↓ Rules Amount
A.
B.
a
t F rn
or in
4-3.
Di R g
s O e So
A.
B.
tri r sa
bu le lu
4-4.
tio t io
n
ns
SG-104
65724_04_ch04_p097-116 4/15/09 11:50 AM Page SG-105
Name __________________________________ Class ____________________ Date ____________________
4-5.
(A)
J. TRENT
INCOME STATEMENT
Pe
ar
so
n
No eL
(B) a
t F rn
or in
J. TRENT
Di g
s O e R
tri r sa So
bu le lu
tio t io
n n s
SG-105
65724_04_ch04_p097-116 4/15/09 11:50 AM Page SG-106
Name __________________________________ Class ____________________ Date ____________________
(C)
Pe
ar
so
n
No eL
a
t F rn
DECEMBER 31, 200X
or in
BALANCE SHEET
J. TRENT
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
ASSETS
SG-106
65724_04_ch04_p097-116 4/15/09 11:50 AM Page SG-107
Name __________________________________ Class ____________________ Date ____________________
Pe
ar
so
n
(2)
KEVIN’S MOVING CO.
L
INCOME STATEMENT
FOR MONTH ENDED OCTOBER 31, 200X
No e
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio KEVIN’S MOVING CO.
t io
n
n
FOR MONTH ENDED OCTOBER 31, 200X
(2)
s
SG-107
65724_04_ch04_p097-116 4/15/09 11:50 AM Page SG-108
Name __________________________________ Class ____________________ Date ____________________
(2)
Pe
ar
so
n
No eL
a
t F rn
KEVIN’S MOVING CO.
OCTOBER 31, 200X
or in
BALANCE SHEET
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
ASSETS
SG-108
65724_04_ch04_p097-116 4/15/09 11:50 AM Page SG-109
Name __________________________________ Class ____________________ Date ____________________
(2)
DICK’S REPAIR SERVICE
INCOME STATEMENT
Pe
ar
so
n
No eL
a
t F rn
(2)
or in
Di R g DICK’S REPAIR SERVICE
s O e So
tri
r sa
bu le lu
tio t io
n n s
SG-109
65724_04_ch04_p097-116 4/15/09 11:50 AM Page SG-110
Name __________________________________ Class ____________________ Date ____________________
(2)
Pe
ar
so
n
No eL
a
t F rn
DICK’S REPAIR SERVICE
NOVEMBER 30, 200X
or in
BALANCE SHEET
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
ASSETS
SG-110
65724_04_ch04_p097-116 4/15/09 11:50 AM Page SG-111
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 4
THE ACCOUNTING CYCLE CONTINUED:
PREPARING WORKSHEETS AND FINANCIAL STATEMENTS
Part I Instructions
PeFill in the blank(s) to complete the statement.
ar
1. _______________ is an estimate.
2. A(n) _______________ will decrease accumulated depreciation.
so
3. _______________ affect both the income statement and balance sheet.
4. The adjustment for supplies reflects the amount of supplies _______________ _______________.
5. Supplies Expense is found on the income statement. Supplies are found on the _______________
n
_______________.
6. _______________ _______________ reflects the cost of equipment at time of purchase.
L
7. Depreciation Expense is found on the _______________ _______________.
No e
8. _______________ _______________ is a contra asset that has a credit balance.
9. Accumulated Depreciation, a contra asset, is found on the _______________ _______________.
a
10. Historical or original cost of an auto less _______________ _______________ reflects the unused
t F rn
amount of the auto on the accounting books.
11. Withdrawals are found in the _______________ column of the balance sheet section of the
or in
worksheet.
12. Salaries Payable is a liability that will appear in the _______________ _______________
Di g
_______________ _______________ of the worksheet.
R
13. The figure for net income on the worksheet is carried over to the _______________ column of the
s O e So
balance sheet.
tri r sa
14. A worksheet is a(n) _______________ report.
15. _______________ _______________ are prepared after the completion of the worksheet.
Part II Instructions bu le lu
tio t
Complete the following statements by circling the letter of the appropriate answer.
io
n ns
SG-111
65724_04_ch04_p097-116 4/15/09 11:50 AM Page SG-112
Name __________________________________ Class ____________________ Date ____________________
1. The adjustment for depreciation results in Accumulated Depreciation

a. decreasing.
b. staying the same.
c. increasing.
2. The historical or original cost of an asset on the worksheet
a. never changes.
Pe
b. sometimes changes.
c. continually changes.
3. Net income on the worksheet is carried over to the
ar
a. trial balance.
b. adjusted trial balance.
so
c. balance sheet column.
4. Accumulated Depreciation is found on
n
a. a worksheet.
b. an income statement.
L
c. both a worksheet and an income statement.
5. Accumulated Depreciation, a contra asset, is increased by a
No e
a. debit.
a
b. credit.
t F rn
c. both a and b.
6. A worksheet is usually completed
or in
a. one column at a time.
b. two columns at a time.
Di g
c. three columns at a time.
R
7. Withdrawals on the worksheet are found in the
s O e So
a. debit column of the income statement.
tri r sa
b. debit column of the balance sheet.
c. both a and b.
bu le lu
8. The worksheet specifically shows the
a. beginning figure for owner capital.
tio t
b. ending figure for owner capital.
io
c. average figure for owner capital.
n
9. The total of the assets on a formal balance sheet will ___________ equal the total of the debit
n
column of the balance sheet on the worksheet.
s
a. always
b. sometimes
c. never
10. The adjustment for depreciation affects
a. the income statement.
b. the balance sheet.
c. both a and b.
11. The adjustment for supplies requires one to know
a. beginning supplies plus supplies purchased.
b. supplies on hand.
c. both a and b.
SG-112
65724_04_ch04_p097-116 4/15/09 11:50 AM Page SG-113
Name __________________________________ Class ____________________ Date ____________________
12. The purpose of adjustments is to

a. bring general journals up to date.
b. bring ledger accounts up to proper balances in the journal.
c. bring ledger accounts to proper balance.
13. Book values equals cost less
a. expenses.
Pe
b. accumulated depreciation.
c. neither a nor b.
14. The ___________ is an informal report.
ar
a. income statement
b. balance sheet
so
c. worksheet
n
L
No e
a
1. The normal balance of accumulated depreciation is a credit.
t F rn
2. Liabilities are only income statement accounts.
3. The total of the adjustments column may balance but be incorrect.
4. Prepaid rent is found on the income statement.
or in
5. Rent expense is found on the income statement.
6. Debits and credits are found on financial statements.
7.
Di R g
Historical cost relates only to automobiles.
s O e
8. Accumulated Depreciation is found on the income statement.
So
9. As Accumulated Depreciation increases, the historical cost changes.
10.
11. tri r sa
The adjustment for depreciation directly affects cash.
bu
An expense is only recorded when it is paid.
le lu
12. The ending figure for owner capital does not have to be calculated from the worksheet.
13. Withdrawals have the same balance as Accumulated Depreciation.
tio t io
14. Salaries Payable is an asset on the income statement.
15. Net loss would never be shown on a worksheet.
n n
16. The net income on the worksheet is the same amount on the income statement.
17. Worksheets must use dollar signs.
s
18. The worksheet eliminates the need to prepare financial statements.
19. Cost less accumulated depreciation equals book value.
20. Accrued Salaries are expenses that have already been paid for.
SG-113
65724_04_ch04_p097-116 4/15/09 11:50 AM Page SG-114
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 4
Part I
1. Depreciation 9. balance sheet

2. debit 10. accumulated depreciation
Pe
3. Adjustments 11. debit
4. used up 12. balance sheet credit column
ar
5. balance sheet 13. credit
6. Historical (original) cost 14. informal
so
7. income statement 15. Financial statements
8. Accumulated Depreciation
Part II
n
1.
2.
c
a
No eL 6.
7.
b
b
11.
12.
c
c
a
3. c 8. a 13. b
t F rn
4. a 9. c 14. c
5. b 10. c
or in
Di g
Part III
1.
s O e R
6. 11. 16.
So
true false false true
tri
3. true 8.
r
false 13.
sa
false 18. false
bu le lu
4. false 9. false 14. false 19. true
5. true 10. false 15. false 20. false
tio t io
n ns
SG-114
65724_04_ch04_p097-116 4/15/09 11:50 AM Page SG-115
Name __________________________________ Class ____________________ Date ____________________
CONTINUING PROBLEM FOR CHAPTER 4*

INCOME STATEMENT
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 200X
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e So
tri
r sa
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 200X
bu le lu
tio t io
n ns
*Use one of the blank fold-out worksheets that accompanied your textbook.
SG-115
65724_04_ch04_p097-116 4/15/09 11:50 AM Page SG-116
Name __________________________________ Class ____________________ Date ____________________
Pe
ar
so
n
No eL
a
t F rn
SEPTEMBER 30, 200X
BALANCE SHEET
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
ASSETS
SG-116
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-117
The Accounting 5
Cycle Completed:
PA djusting,
Cel
a o s i n g , a n
P orss t - C l o s i n g
d t h e
T r i aonl B a l a n c e
No e L
a
t F rn
(1) PAGE 2
or in
Di R g
st Or es S
rib al ol
ut
io
e u tio
n n s
SG-117
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-118
Name __________________________________ Class ____________________ Date ____________________
(2) Partial Ledger

Depreciation Expense, Accumulated Depreciation,
Store Equipment 511 Store Equipment 122
Pe Prepaid Insurance 116 Insurance Expense 516
ar
3
so
n
Store Supplies 114 Supplies Expense 514
L
5
No e
Salaries Expense
a
t F rn
512 Salaries Payable 212
or in
8
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
SG-118
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Name __________________________________ Class ____________________ Date ____________________

(1)
Pe
ar
so
n
No eL
a
t F rn
or in
P. Logan, Capital 310 Revenue from Clients 410 Supplies Expense 514
Di R
14
g
25 4
s O e tri r sa So
bu le lu
Depreciation Expense,
tio t
P. Logan, Withdrawals 311 Store Equipment 510 Insurance Expense 516
n
1
io
2
n s
Income Summary 312 Salaries Expense 512 Rent Expense 518
11 2
SG-119
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Name __________________________________ Class ____________________ Date ____________________
(2)
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-120
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-121
Name __________________________________ Class ____________________ Date ____________________

ROLO COMPANY
GENERAL JOURNAL
PAGE 1
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
SG-121
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-122
Name __________________________________ Class ____________________ Date ____________________

ROLO COMPANY
GENERAL JOURNAL
PAGE 2
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-122
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-123
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar
so
n ACCOUNTS RECEIVABLE ACCOUNT NO. 112
Date
No eL Explanation Post Debit Credit

Balance
a
Ref. Debit Credit
t F rn
or in PREPAID RENT ACCOUNT NO. 114
Di g
Balance
R
s O e So
Ref. Debit Credit
tri r sa
bu OFFICE SUPPLIES
le lu
ACCOUNT NO. 115
Date tio
Explanation Post Debit
t
Credit
io
Balance
n n
Ref. Debit Credit
SG-123
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-124
Name __________________________________ Class ____________________ Date ____________________
Balance
Ref. Debit Credit
Pe
ar ACCUMULATED DEPRECIATION, OFFICE EQUIPMENT ACCOUNT NO. 122
so
Balance
n
Ref. Debit Credit
No eL ACCOUNTS PAYABLE ACCOUNT NO. 211
Date
a
t F rn
Explanation Post
Ref.
Debit Credit
Debit
Balance
Credit
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-124
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Name __________________________________ Class ____________________ Date ____________________
SALARIES PAYABLE ACCOUNT NO. 212
Balance
Ref. Debit Credit
Pe
ar
ROLO KERN, CAPITAL ACCOUNT NO. 311
Balance
so
Ref. Debit Credit
n
No eL ROLO KERN, WITHDRAWALS ACCOUNT NO. 312
Date
a
t F rn
Explanation Post
Ref.
Debit Credit
Debit
Balance
Credit
or in
Di R g
s O e So
INCOME SUMMARY ACCOUNT NO. 313
tri r sa
Balance
bu le lu
Ref. Debit Credit
tio t io
n n s
FEES EARNED ACCOUNT NO. 411
Balance
Ref. Debit Credit
SG-125
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-126
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar ADVERTISING EXPENSE ACCOUNT NO. 512
so
Balance
Ref. Debit Credit
n
No eL
a
RENT EXPENSE ACCOUNT NO. 513
t F rn
Balance
or in
Ref. Debit Credit
Di R g
s O e tri r
OFFICE SUPPLIES EXPENSE
sa So
ACCOUNT NO. 514
bu le lu
Balance
Ref. Debit Credit
tio t io
n n
Date
DEPRECIATION EXPENSE, OFFICE EQUIPMENT

ACCOUNT NO. 515
Credit
Balance s
Ref. Debit Credit
SG-126
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-127
Name __________________________________ Class ____________________ Date ____________________
ROLO COMPANY
INCOME STATEMENT
FOR MONTH ENDED JANUARY 31, 200X
Pe
ar
so
n
No eL
a
t F rn
or in ROLO COMPANY
Di g
R
s O e tri r sa So
bu le lu
tio t io
n n s
SG-127
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Name __________________________________ Class ____________________ Date ____________________
Pe
ar
so
n
No eL
a
t F rn
JANUARY 31, 200X
ROLO COMPANY
BALANCE SHEET
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
ASSETS
SG-128
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-129
Name __________________________________ Class ____________________ Date ____________________
ROLO COMPANY
POST-CLOSING TRIAL BALANCE
JANUARY 31, 200X
Dr. Cr.
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-129
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Name __________________________________ Class ____________________ Date ____________________
CHAPTER 5
GENERAL JOURNAL
1.
PAGE 3
Pe
ar
so
n
No eL
a
t F rn
or in
Di g
Prepaid Insurance 115 Insurance Expense 510
s O e R
So
Depreciation Expense,
tri r
Store Supplies 116
sa
Store Equipment 512
bu
Accumulated Depreciation
le lu
tio t
Store Equipment 119 Supplies Expense 514
n io
n
Salaries Payable 210 Salaries Expense 516
2. s
SG-130
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-131
Name __________________________________ Class ____________________ Date ____________________
GENERAL JOURNAL
3.
PAGE 4
Pe
ar
so
n
No eL
a
t F rn
or in
4.
Di R g
s O e
Income Summary
tri r
314
sa So
bu le lu
tio t io
5.
n n s
Mel Blanc, Capital 310
SG-131
65724_05_ch05_p117-185 4/16/09 2:42 PM Page SG-132
Name __________________________________ Class ____________________ Date ____________________
FORMS FOR EXERCISES
5-1.
Pe
ar
so
n
No eL
5-2. a
t F rn
or in
TEMPORARY PERMANENT WILL BE CLOSED
1. Income Summary
Di g
2. Jen Rich, Capital
3. Salary Expense
s O e R
So
4. Jen Rich, Withdrawals
tri r sa
5. Fees Earned
6. Accounts Payable
7. Cash
bu le lu
tio t io
n n s
SG-132
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-133
Name __________________________________ Class ____________________ Date ____________________
5-3.
Pe
ar
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No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-133
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Name __________________________________ Class ____________________ Date ____________________
5-4.
Pe
ar
so
n
No eL
a
t F rn
5-5.
or in
Di g
WEY CO.
s O e R POST-CLOSING TRIAL BALANCE
sa So
DECEMBER 31, 200X
tri r Dr. Cr.
bu le lu
tio t io
n n s
SG-134
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-135
Name __________________________________ Class ____________________ Date ____________________
(2)
DEBBIE’S DANCE STUDIO
Pe
GENERAL JOURNAL
PAGE 3
ar Date Account Titles and Description PR Dr. Cr.
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
SG-135
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-136
Name __________________________________ Class ____________________ Date ____________________
(1)
POTTER CLEANING SERVICE
GENERAL JOURNAL
PAGE 2
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-136
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Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar
PREPAID INSURANCE ACCOUNT NO. 114
so
Balance
Ref. Debit Credit
n
No eL
a
CLEANING SUPPLIES ACCOUNT NO. 115
t F rn
Balance
Ref. Debit Credit
or in
Di R g
s O e tri r
AUTO
sa So
ACCOUNT NO. 121
Balance
Date
bu
Explanation Post
Ref.
Debit
le lu
Credit
Debit Credit
tio t io
n n
Date
ACCUMULATED DEPRECIATION, AUTO

ACCOUNT NO. 122
Credit
s
Balance
Ref. Debit Credit
SG-137
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-138
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar SALARIES PAYABLE ACCOUNT NO. 213
so
Balance
Ref. Debit Credit
n
No eL
a
B. POTTER, CAPITAL ACCOUNT NO. 312
t F rn
Balance
or in
Ref. Debit Credit
Di R g
s O e tri r sa So
bu
B. POTTER, WITHDRAWALS
le lu
ACCOUNT NO. 313
tio t
Balance
io
Ref. Debit Credit
n n
s
Balance
Ref. Debit Credit
SG-138
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-139
Name __________________________________ Class ____________________ Date ____________________

CLEANING FEES ACCOUNT NO. 412
Balance
Ref. Debit Credit
Pe
ar SALARIES EXPENSE ACCOUNT NO. 513
so
Balance
Ref. Debit Credit
n
No eL
a
t F rn
Balance
or in
Ref. Debit Credit
Di R g
s O e tri r
ADVERTISING EXPENSE
sa So
ACCOUNT NO. 515
Date bu
le lu
Credit
Balance
tio t
Ref. Debit Credit
n io
GAS EXPENSE ACCOUNT NO. 516
n s
Balance
Ref. Debit Credit
SG-139
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-140
Name __________________________________ Class ____________________ Date ____________________

INSURANCE EXPENSE ACCOUNT NO. 517
Balance
Ref. Debit Credit
Pe
ar
CLEANING SUPPLIES EXPENSE ACCOUNT NO. 518
so
Balance
Ref. Debit Credit
n
No eL
a
DEPRECIATION EXPENSE, AUTO
t F rn
ACCOUNT NO. 519
Balance
or in
Ref. Debit Credit
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-140
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-141
Name __________________________________ Class ____________________ Date ____________________

(2)
POTTER CLEANING SERVICE
MARCH 31, 200X
Dr. Cr.
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
SG-141
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-142
Name __________________________________ Class ____________________ Date ____________________

PETE’S PLOWING
GENERAL JOURNAL
PAGE 1
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-142
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-143
Name __________________________________ Class ____________________ Date ____________________

PETE’S PLOWING
GENERAL JOURNAL
PAGE 2
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-143
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-144
Name __________________________________ Class ____________________ Date ____________________

PETE’S PLOWING
GENERAL JOURNAL
PAGE 3
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-144
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-145
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar
so
n
a
Balance
t F rn
Ref. Debit Credit
or in
Di R g PREPAID RENT ACCOUNT NO. 114
s O e sa So
Balance
tri r
Ref. Debit Credit
bu le lu
tio
SNOW SUPPLIES
t io
ACCOUNT NO. 115
n n
Balance
s
Ref. Debit Credit
SG-145
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-146
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar
ACCUMULATED DEPRECIATION, OFFICE EQUIPMENT ACCOUNT NO. 122
Balance
so
Ref. Debit Credit
n
L
SNOW EQUIPMENT ACCOUNT NO. 123
No e
Balance
a
Ref. Debit Credit
t F rn
or in
Di g
ACCUMULATED DEPRECIATION, SNOW EQUIPMENT ACCOUNT NO. 124
R
Balance
s O e So
tri r sa
Ref. Debit Credit
bu le lu
tio t io
Balance
n n
Ref. Debit Credit
SG-146
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-147
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar PETE MACK, CAPITAL ACCOUNT NO. 311
so
Balance
Ref. Debit Credit
n
No eL
a
PETE MACK, WITHDRAWALS ACCOUNT NO. 312
t F rn
Balance
Ref. Debit Credit
or in
Di R g
s O e tri r
INCOME SUMMARY
sa So
ACCOUNT NO. 313
bu
Balance
le lu
Ref. Debit Credit
tio t io
n n
PLOWING FEES ACCOUNT NO. 411
s
Balance
Ref. Debit Credit
SG-147
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-148
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar ADVERTISING EXPENSE ACCOUNT NO. 512
Date
so Explanation Post Debit Credit
Balance
n
Ref. Debit Credit
No eL
Date Explanation
a
TELEPHONE EXPENSE
t F rn Post Debit
ACCOUNT NO. 513
Credit
Balance
or in
Ref. Debit Credit
Di R g
s O e tri r
RENT EXPENSE
sa So
ACCOUNT NO. 514
bu le lu
Balance
tio t
Ref. Debit Credit
n io
SNOW SUPPLIES EXPENSE ACCOUNT NO. 515 n
Balance s
Ref. Debit Credit
SG-148
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-149
Name __________________________________ Class ____________________ Date ____________________

DEPRECIATION EXPENSE, OFFICE EQUIPMENT ACCOUNT NO. 516
Balance
Ref. Debit Credit
Pe
ar
DEPRECIATION EXPENSE, SNOW EQUIPMENT ACCOUNT NO. 517
so
Balance
Ref. Debit Credit
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-149
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-150
Name __________________________________ Class ____________________ Date ____________________
PETE’S PLOWING
INCOME STATEMENT
Pe
ar
so
n
No eL
a
t F rn
or in PETE’S PLOWING
Di g
R
s O e tri r sa So
bu le lu
tio t io
n n s
SG-150
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-151
Name __________________________________ Class ____________________ Date ____________________
Pe
ar
so
n
No eL
a
t F rn
JANUARY 31, 200X
PETE’S PLOWING
BALANCE SHEET
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
ASSETS
SG-151
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-152
Name __________________________________ Class ____________________ Date ____________________

PETE’S PLOWING
JANUARY 31, 200X
Dr. Cr.
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-152
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-153
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 5
THE ACCOUNTING CYCLE COMPLETED:
ADJUSTING, CLOSING, AND
THE POST-CLOSING TRIAL BALANCE
Pe
Part I Instructions
ar
1.
2.
After the closing process only
Revenue, Expenses, and Withdrawals are examples of
accounts remain with balances.
.
so
3. in temporary accounts will not be carried over to the next accounting period.
4. After closing entries are posted, owner’s Capital in the ledger will contain the
n
.
5. Revenue is closed to Income Summary by a(n) to each revenue account and a(n)
L
to Income Summary.
6. Expenses are closed to Income Summary by the individual expenses and
No e
Income Summary.
a
7. If the balance of Income Summary is a credit, it will be closed by Income
t F rn
Summary and owner’s Capital.
8. The balance of Withdrawals is closed by a(n) and the amount transferred to
owner’s Capital by a(n) .
or in
9. At the end of the closing process, all temporary accounts in the ledger will have a(n)
balance.
10. The
Di R g
contains a list
s O e
of permanent accounts after the adjusting and closing entries have been posted to the ledger from a
tri So
journal.
11.
r
Closing entries can be prepared from a(n)
sa .
bu
12. After closing entries are posted, Income Summary will have a(n) balance.
le lu
13. Journalizing adjustments can be done from the .
14. Cash, Equipment, and Supplies are not part of the process.
tio t io
15. Income Summary is a(n) account.
n n s
The following is a chart of accounts for Al’s Auto Shop. From the chart, indicate in Column B (by account
number) which accounts will be debited or credited as related to the transactions in Column A.
SG-153
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-154
Name __________________________________ Class ____________________ Date ____________________
CHART OF ACCOUNTS
ASSETS OWNER’S EQUITY
112 Cash 340 A. Jones, Capital
114 Accounts Receivable 341 A. Jones, Withdrawals
116 Prepaid Rent 342 Income Summary
118 Auto Supplies
Pe
120 Delivery Truck REVENUE
121 Accumulated Depreciation, Delivery Truck 450 Fees Earned
ar
LIABILITIES EXPENSES
230 Accounts Payable 560 Salaries
so
232 Salaries Payable 562 Advertising
564 Rent
n
566 Auto Supplies
568 Depreciation Expense, Delivery Truck
COLUMN A
No eL Debit(s)
COLUMN B
Credit(s)
a
1. Closed balance in revenue
t F rn
account to Income Summary.
2. Closed balance in individual
or in
expenses to Income Summary.
3. Closed balance in Income
Di R
Summary to owner’s Capital.
g
s O e
(Assume that it is a net income.)
4.
5.
tri
Closed Withdrawals to owner’s Capital.
Recorded auto supplies used up.
r sa So
6.
7. bu
Recorded depreciation on delivery truck.
Brought Salaries Expense up to
le lu
tio t io
date (an adjustment).

n ns
1. Closing entries are done every other month.

2. Adjustments are journalized before preparing the worksheet.
3. Closing entries can only clear permanent accounts.
4. Income summary is a temporary account.
5. Interim statements can be prepared from worksheets.
6. To clear expenses in the closing process, a compound entry is appropriate.
7. Withdrawals is a temporary account on the income statement.
8. Income Summary helps update withdrawals.
SG-154
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-155
Name __________________________________ Class ____________________ Date ____________________
9. Accumulated Depreciation is a permanent account on the income statement.

10. Cash, Rent Expense, and Accounts Receivable need to be closed at the end of the period.
11. Closing entries do not relate to the worksheet.
12. Revenue is closed by a credit.
13. Expenses are placed on the debit side of the Income Summary account.
Pe
14. A post-closing trial balance closely resembles the ending balance sheet.
15. Accumulated Depreciation never has to be adjusted.
ar
16. Interim statements are always prepared monthly.
17. A post-closing trial balance is prepared before adjustments are journalized.
so
18. Income Summary is shown on the balance sheet.
19. The process of closing entries will help update owner’s Capital.
n
20. The normal balance of the Income Summary is a debit.
21. The normal balance of the Income Summary is a credit.
L
22. The income statement is listed in terms of debits and credits.
No e
23. Closing updates only permanent accounts.
a
24. The completion of financial statements means that the Capital account in the ledger has been
t F rn
updated.
25. Withdrawals is closed to Income Summary.
or in
Di g
s O e R
So
Part I
1. permanent
tri r 9. zero
sa
bu le lu
2. temporary accounts 10. post-closing trial balance
3. Balances 11. worksheet
tio t
4. ending figure (balance) 12. zero
io
5. debit, credit 13. worksheet
6. crediting, debiting 14. closing
7. debiting, crediting 15.
n temporary
n s
8. credit, debit
Part II
Debit Credit
1. 450 342
2. 342 560, 562, 564, 566, 568
3. 342 340
4. 340 341
5. 566 118
6. 568 121
7. 560 232
SG-155
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-156
Name __________________________________ Class ____________________ Date ____________________
Part III
1. false 7. false 13. true 19. true 25. false

3. false 9. false 15. false 21. false
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
SG-156
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-157
Name __________________________________ Class ____________________ Date ____________________

GENERAL JOURNAL
PAGE 2
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-157
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-158
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe ACCOUNTS RECEIVABLE ACCOUNT NO. 1020

Balance
ar
Ref. Debit Credit
so
n
No eL PREPAID RENT ACCOUNT NO. 1025
a
Balance
t F rn
Ref. Debit Credit
or in
Di R g
s O e tri r
SUPPLIES
sa So
ACCOUNT NO. 1030
bu le lu
Balance
t
9/30 0X Balance forward tioRef.

⻬
Debit
4 5 0 00
io
Credit
n n s
SG-158
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-159
Name __________________________________ Class ____________________ Date ____________________
COMPUTER SHOP EQUIPMENT ACCOUNT NO. 1080

Balance
Ref. Debit Credit
Pe
ar
ACCUMULATED DEPRECIATION, COMPUTER SHOP EQUIPMENT ACCOUNT NO. 1081
so
Balance
n
Ref. Debit Credit
No eL
a
t F rn OFFICE EQUIPMENT ACCOUNT NO. 1090
or in
Balance
Di g
Ref. Debit Credit
R
s O e tri r sa So
bu
ACCUMULATED DEPRECIATION, OFFICE EQUIPMENT
le lu
ACCOUNT NO. 1091
tio t
Balance
io
Ref. Debit Credit
n n s
SG-159
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-160
Name __________________________________ Class ____________________ Date ____________________
Balance
Ref. Debit Credit
Pe
ar
so
n
T. FREEDMAN, CAPITAL ACCOUNT NO. 3000
Balance
L
No e
Ref. Debit Credit
⻬
a
9/30 0X Balance forward 4 5 0 0 00
t F rn
or in
Di R g
s O e tri r
T. FREEDMAN, WITHDRAWALS
sa So
ACCOUNT NO. 3010
bu le lu
Balance
tio t
Ref. Debit Credit
io
n n s
SG-160
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-161
Name __________________________________ Class ____________________ Date ____________________
Balance
Ref. Debit Credit
Pe
ar
so
n SERVICE REVENUE ACCOUNT NO. 4000
L
Balance
No e
a
Ref. Debit Credit
⻬
t F rn
or in
Di R g
s O e So
Balance
tri r sa
Ref. Debit Credit
bu le lu
tio t io
n n
Date Explanation
RENT EXPENSE
Post Debit
ACCOUNT NO. 5020
Credit
s
Balance
Ref. Debit Credit

SG-161
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-162
Name __________________________________ Class ____________________ Date ____________________
Balance
Ref. Debit Credit
Pe
ar PHONE EXPENSE ACCOUNT NO. 5040
Date so Explanation Post Debit Credit

Balance
n
Ref. Debit Credit
No eL
a
t F rn
or in
SUPPLIES EXPENSE ACCOUNT NO. 5050
Balance
Di g
R
Ref. Debit Credit
s O e tri r sa So
bu le lu
tio
INSURANCE EXPENSE
t
ACCOUNT NO. 5060
io
n n
Balance
s
Ref. Debit Credit
SG-162
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-163
Name __________________________________ Class ____________________ Date ____________________
Balance
Ref. Debit Credit
Pe
ar
so DEPRECIATION EXPENSE C.S. EQUIPMENT ACCOUNT NO. 5080
n
Balance
L
Ref. Debit Credit
No e
a
t F rn
or in
DEPRECIATION EXPENSE OFFICE EQUIPMENT ACCOUNT NO. 5090
Di R g Balance
s O e So
tri r
Ref. Debit Credit
sa
bu le lu
tio t io
n n s
SG-163
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-164
Name __________________________________ Class ____________________ Date ____________________

SEPTEMBER 30, 200X
Dr. Cr.
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-164
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-165
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET

SULLIVAN REALTY
SULLIVAN REALTY
GENERAL JOURNAL
PAGE 1
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-165
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-166
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET

SULLIVAN REALTY
SULLIVAN REALTY
GENERAL JOURNAL
PAGE 2
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-166
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-167
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET

SULLIVAN REALTY
SULLIVAN REALTY
GENERAL JOURNAL
PAGE 3
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-167
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-168
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET

SULLIVAN REALTY
SULLIVAN REALTY
GENERAL JOURNAL
PAGE 4
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-168
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-169
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET

SULLIVAN REALTY
SULLIVAN REALTY
GENERAL JOURNAL
PAGE 5
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-169
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-170
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET

SULLIVAN REALTY
SULLIVAN REALTY
GENERAL JOURNAL
PAGE 6
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-170
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-171
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET

SULLIVAN REALTY
Balance
Ref. Debit Credit
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-171
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-172
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET

SULLIVAN REALTY
Balance
Ref. Debit Credit
Pe
ar
so PREPAID RENT ACCOUNT NO. 114
n Balance
L
Ref. Debit Credit
No e
a
t F rn
or in
Di g
OFFICE SUPPLIES ACCOUNT NO. 115
s O e R
sa So
Balance
tri r
Ref. Debit Credit
bu le lu
tio t io
n n
Balance
s
Ref. Debit Credit
SG-172
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-173
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET: SULLIVAN REALTY

Balance
Ref. Debit Credit
Pe
ar
so
AUTOMOBILE ACCOUNT NO. 123
Balance
n
Ref. Debit Credit
No eL
a
ACCUMULATED DEPRECIATION, AUTOMOBILE ACCOUNT NO. 124
t F rn
Balance
or in
Ref. Debit Credit
Di R g
s O e tri
ACCOUNTS PAYABLE
r sa So
ACCOUNT NO. 211
Balance
bu le lu
Ref. Debit Credit
tio t io
n n s
Balance
Ref. Debit Credit
SG-173
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-174
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET

SULLIVAN REALTY
JOHN SULLIVAN, CAPITAL ACCOUNT NO. 311
Balance
Ref. Debit Credit
Pe
ar
so
n
No eL
JOHN SULLIVAN, WITHDRAWALS ACCOUNT NO. 312
a
Balance
t F rn
Ref. Debit Credit
or in
Di R g
s O e tri r sa So
bu le lu
tio t
n io
Balance
n
Ref. Debit Credit
SG-174
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-175
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET

SULLIVAN REALTY
COMMISSIONS EARNED ACCOUNT NO. 411
Balance
Ref. Debit Credit
Pe
ar
so
n
No eL
a
t F rn
Balance
or in
Ref. Debit Credit
Di R g
s O e tri r sa So
bu
SALARIES EXPENSE
le lu
ACCOUNT NO. 512
Date tio
t
Credit
io
Balance
n n
Ref. Debit Credit
SG-175
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-176
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET

SULLIVAN REALTY
GAS EXPENSE ACCOUNT NO. 513
Balance
Ref. Debit Credit
Pe
ar
so
n
REPAIRS EXPENSE ACCOUNT NO. 514
L
Balance
No e
a
Ref. Debit Credit
t F rn
or in
Di R g
s O e sa So
tri r Balance
bu
le lu
Ref. Debit Credit
tio t io
n n
Balance
s
Ref. Debit Credit
SG-176
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-177
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET

SULLIVAN REALTY
OFFICE SUPPLIES EXPENSE ACCOUNT NO. 517
Balance
Ref. Debit Credit
Pe
ar
so
n
L
Balance
No e
a
Ref. Debit Credit
t F rn
or in
Di R g
s O e sa So
DEPRECIATION EXPENSE, AUTOMOBILE ACCOUNT NO. 519
tri r Balance
bu
le lu
Ref. Debit Credit
tio t io
n n
MISCELLANEOUS EXPENSE ACCOUNT NO. 524
s
Balance
Ref. Debit Credit
SG-177
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-178
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET

SULLIVAN REALTY
Use the blank fold-out worksheets that accompanied your textbook.
SULLIVAN REALTY
INCOME STATEMENT
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-178
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-179
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET

SULLIVAN REALTY
SULLIVAN REALTY
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-179
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-180
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET

SULLIVAN REALTY
Pe LIABILITIES AND OWNER’S EQUITY
ar
so
n
No eL
a
t F rn
SULLIVAN REALTY
or in
BALANCE SHEET
JUNE 30, 200X
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
ASSETS
SG-180
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-181
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET

SULLIVAN REALTY
SULLIVAN REALTY
JUNE 30, 200X
Dr. Cr.
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e
You can find the worksheet for July with the blank fold-out worksheets that accompanied your textbook.
tri r sa So
bu le lu
tio t io
n n s
SG-181
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-182
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET

SULLIVAN REALTY
SULLIVAN REALTY
INCOME STATEMENT
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-182
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-183
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET

SULLIVAN REALTY
SULLIVAN REALTY
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-183
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-184
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET

SULLIVAN REALTY
Pe LIABILITIES AND OWNER’S EQUITY
ar
so
n
No eL
a
t F rn
SULLIVAN REALTY
or in
BALANCE SHEET
JULY 31, 200X
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
ASSETS
SG-184
65724_05_ch05_p117-185 4/15/09 11:50 AM Page SG-185
Name __________________________________ Class ____________________ Date ____________________
MINI PRACTICE SET

SULLIVAN REALTY
SULLIVAN REALTY
JULY 31, 200X
Dr. Cr.
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-185
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-186
Banking 6
Procedures
a Pn d C o n t r o l
o feaC a s h
rs
on
L
Add to Deduct from Add to Deduct from
No e
Situation Bank Balance Bank Balance Checkbook Balance Checkbook Balance
1
a
2
t F rn
3
4
or in
5
6
Di g
7
8
s O e R
tri r sa So
bu le lu
PAGE 6
tio t
n io
n s
SG-186
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-187
Name __________________________________ Class ____________________ Date ____________________
Amount
Sundry
Pe
Account
Category of Payment
ar
so Expense
General
n
No eL
Delivery
Expense
AUXILIARY PETTY CASH RECORD
a
t F rn
or in
Payment
Di R g
s O e tri r sa So
bu le lu
Receipts
tio t io
n n
Description
s
Voucher
No.Date
SG-187
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-188
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 6
SET A FORMS FOR CLASSROOM DEMONSTRATION EXERCISES
1.
A. ___________________ E. ___________________
B. ___________________ F. ___________________
C. ___________________
Pe
D. ___________________
2. ________ _______ _______ ______
ar
3.
ACE CO.
so
BANK RECONCILIATION
JUNE 30, 200X
n
Checkbook Bank
No eL
a
t F rn
or in
4.
A. ______ _______ ______ E. ______ _______ ______
Di g
B. ______ _______ ______ F. ______ _______ ______
C. ______
s O e
_______
R ______
So
D. ______ _______ ______
5.
tri r sa
bu le lu
tio t io
n n
6. s
SG-188
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-189
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 6
SET B FORMS FOR CLASSROOM DEMONSTRATION EXERCISES
1.
A. ___________________ E. ___________________
B. ___________________ F. ___________________
C. ___________________
Pe
D. ___________________
2. ________ _______ _______ ______
ar
3.
ACE CO.
so
BANK RECONCILIATION
JUNE 30, 200X
n
Checkbook Bank
No eL
a
t F rn
or in
4.
A. ______ _______ ______ E. ______ _______ ______
Di g
B. ______ _______ ______ F. ______ _______ ______
C.
s O e
______
R _______ ______
So
D. ______ _______ ______
5.
tri r sa
bu le lu
tio t io
n n
6. s
SG-189
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-190
Name __________________________________ Class ____________________ Date ____________________
FORMS FOR EXERCISES
6-1.
BING CO.
BANK RECONCILIATION AS OF JULY 31, 200X
CHECKBOOK BALANCE BALANCE PER BANK
Pe
Ending Checkbook Balance _________________ Ending Bank Statement Balance ________________
Deduct: _________________ Add: ________________
Bank Service Charge _________________ Deposit in Transit ________________
ar
_________________ ________________
_________________ Deduct: ________________
_________________ Outstanding Checks ________________
so
_________________ ________________
Reconciled Balance _________________ Reconciled Balance ________________
n
No eL
6-2.
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
6-3. tio t io
n n s
SG-190
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-191
Name __________________________________ Class ____________________ Date ____________________
6-4.
Pe
ar
so
6-5.
Beg. Change Fund
+Cash Register Total
n
=Cash should have on hand
– Counted Cash
L
= Cash Shortage
No e
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-191
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-192
Name __________________________________ Class ____________________ Date ____________________

LEE.COM
BANK RECONCILIATION AS OF JULY 31, 200X
Pe
BALANCE PER BANK CHECKBOOK BALANCE
ar
Bank Statement Balance Checkbook Balance
Add: _________________ Add:
so
Deduct: _________ _________________
n
_________________ Deduct:
L
_________________
No e
a
Reconciled Balance _________________ Reconciled Balance _________________
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-192
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-193
Name __________________________________ Class ____________________ Date ____________________
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-193
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-194
Name __________________________________ Class ____________________ Date ____________________

LOWELL NATIONAL BANK
RIO MEAN BRAND
BUGNA, TEXAS TELEPHONE 555-8311
This form is provided to help you balance your bank statement. If no errors are reported to auditors in
ten days, the account will be considered correct.
Pe
Please notify us of any change in address.
ar
Checks outstanding
(not charged to account)
so Sort the checks numerically or
n
by date issued.
Check No. Amount Check off on the stubs of your
checkbook each check paid by bank.
No eL List the numbers and amounts of

checks still outstanding in the
a
space provided at the left.
t F rn
Verify the deposits in your checkbook with
deposits credited on this statement. Bank
balance show on this statement $_____________
or in
Plus: Deposits not
credited on this statement $_____________
Di R g
Subtotal $_____________
s O e
Less: Checks outstanding $_____________
So
Total Balance $_____________
tri r sa
If your checkbook does not agree, enter any
bu le lu
necessary adjustments:
___________________________
___________________________
tio t io
___________________________
Correct checkbook balance $_____________
n n s
SG-194
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-195
Name __________________________________ Class ____________________ Date ____________________
GENERAL JOURNAL
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-195
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-196
Name __________________________________ Class ____________________ Date ____________________
MERRY CO.
GENERAL JOURNAL
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-196
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-197
Name __________________________________ Class ____________________ Date ____________________
Amount
Sundry
Pe Account
ar
Category of Payment
so
Office Supplies
Expense
n
No eL
a
Expense
Postage
t F rn
or in
MERRY CO.
Di R g
Payment
s O e tri r sa So
bu le lu
Receipts
tio t io
n ns
Description
Voucher
No. Date
SG-197
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-198
Name __________________________________ Class ____________________ Date ____________________

LOGAN CO.
GENERAL JOURNAL
PAGE 2
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-198
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-199
Name __________________________________ Class ____________________ Date ____________________
Amount
Sundry
Pe
Account
ar Category of Payment
so Delivery
Expense
n
No eL
a
Expense
Postage
t F rn
or in
LOGAN CO.
Di R g
Payment
s O e tri r sa So
bu le lu
Receipts
tio t io
n ns
Description
Voucher
No.Date
SG-199
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-200
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 6
SUMMARY PRACTICE TEST
BANKING PROCEDURES AND CONTROL OF CASH
Part I Instructions
1.
Pe
Online banking is _______________ due to the internet.
ar
2. Today, use of the _______________ _______________ has greatly increased.
3. All adjustments to the checkbook balance in the reconciliation process will
require _______________ _______________.
so
4. Petty cash is a(n) _______________ found on the balance sheet.
5. The auxiliary petty cash record is not a(n) _______________.
n
6. A(n) _______________ _______________ is an asset used to make change for customer.
7. A cash overage will be _______________ _______________ on the income statement.
L
8. _______________ _______________ represents checks not processed by the bank at the time the
bank statement was prepared.
No e
9. When a bank credits your account, your balance will _______________.
a
10. _______________ is a procedure whereby the bank does not return the processed checks.
t F rn
or in
Indicate which of the following procedures are involved in each of the transactions below.
a.
Di R
Recorded in General Journal
g
s O e
b. Recorded in both general journal and auxiliary petty cash record
tri So
c. Recorded only in auxiliary petty cash record
d. New check is written
r sa
bu
e. Account petty cash is increased
1. EXAMPLE: Check issued to establish petty cash

le lu
b,d,e
2.
3.
Paid donation from petty cash
Paid postage from petty cash tio t
__________
__________
io
4. Paid past purchases previously charged
n __________
ns
5. Paid for business luncheon with petty cash __________
6. Issued check to pay for office supplies __________
7. Replenished petty cash __________
8. Paid local donation from petty cash __________
9. Paid for past purchases bought on account __________
10. Replenished petty cash __________
SG-200
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-201
Name __________________________________ Class ____________________ Date ____________________

1. Online banking is decreasing today.

2. Petty cash is a liability found on the balance sheet.
3. Checks returned from the bank are placed in alphabetical order.
Pe 4.
5.
ATMs are being used less today than in the past.
Bank service charges represent an expense to the business.
ar
6. The bank statement is the same as the bank reconciliation.
so
7. The balance in the company cash account will always equal the bank balance before the bank
statement is received.
8. Deposit slips are needed in writing checks.
9.
n
The signature must be presented when cashing a check.
L
10. The auxiliary petty cash record is posted monthly.
No e
11. The petty cash account has a debit balance.
a
12. Replenishment of petty cash requires a new check.
t F rn
13. The expenses paid from petty cash are journalized at time of replenishment.
14. Internal control only affects large companies.
or in
15. A petty cash voucher records the expense into the ledger.
16. The petty cash fund must be replenished monthly.
17.
Di R g
The petty cash voucher identifies the account that will be charged.
s O e So
18. The establishment of petty cash may require some judgment as to the amount of petty cash needed.
19.
tri r
EFT is the same as safekeeping.
sa
bu
20. The drawer is the person who receives the check.
21. A debit memo will increase the depositor’s balance.
le lu
tio t
22. A change fund uses only one denomination.
23. The payer is the person or company the check is payable to.
n io
Part IV Instructions
n s
Based on the following situation, prepare a bank reconciliation.
The checkbook balance of Logan Company is $5,263.08. The bank statement shows a bank balance of
$7,980. The bank statement shows interest earned of $42 and a service charge of $29.76. There is a deposit
in transit of $2,558.22. Outstanding checks total $3,762.90. The bank collected a note for Moore for
$4,200. Moore Company forgot to deduct a check for $2,700 during the month.
SG-201
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-202
Name __________________________________ Class ____________________ Date ____________________
Part I
1. increasing 6. change fund

2. debit card 7. miscellaneous income
3. journal entries 8. Checks outstanding
Pe
4. asset 9. increase
5. journal 10. Safekeeping
Part II
ar
so
1. b, d, e 6. a, d
2. c 7. b, d
n
3. c 8. c
4. a, d 9. a, d
L
5. c 10. b, d
No e
Part III
1.
2.
3.
false
false
false
6.
7.
8. a
false
t F rn
false
false
11.
12.
13.
true
true
true
16.
17.
18.
false
true
true
21.
22.
23.
false
false
false
or in
4. false 9. true 14. false 19. false
Part IV
Di R g
LOGAN CO.
s O e tri r sa So BANK BALANCE
bu
Checkbook Balance $5,263.08 Bank Balance $7,980.00
le lu
ADD: ADD:
Deposit
Interest
Collection of note
$ 42
4,200tio 4,242.00
t
in Transit
io
2,558.22
$9,038.22
n n
8,005.08
s
DEDUCT: DEDUCT:
Service Chg. $ 29.76 Check outstanding $3,762.90
Error 2,700.00 2,729.76
Reconciled Balance $6,775.32 Reconciled Balance $6,775.32
SG-202
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-203
Name __________________________________ Class ____________________ Date ____________________

GENERAL JOURNAL
PAGE 3
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-203
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-204
Name __________________________________ Class ____________________ Date ____________________
Balance
Ref. Debit Credit
Pe
ar
so
n
No eL
a
t F rn
or in
PETTY CASH ACCOUNT NO. 1010
Balance
Di g
R
Ref. Debit Credit
s O e tri r sa So
bu le lu
tio t io
n n s
SG-204
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-205
Name __________________________________ Class ____________________ Date ____________________
Balance
Ref. Debit Credit
Pe
ar PREPAID RENT ACCOUNT NO. 1025
so
Balance
n
Ref. Debit Credit
No eL
a
t F rn SUPPLIES ACCOUNT NO. 1030
or in
Balance
Di g
Ref. Debit Credit
s O e R
tri r sa So
bu le lu
tio t io
n COMPUTER SHOP EQUIPMENT
n
ACCOUNT NO. 1080
Date Explanation

Post
Ref.
⻬
Debit Credit
2
Debit
4 0 0 00
s
Balance
Credit
SG-205
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-206
Name __________________________________ Class ____________________ Date ____________________
Balance
Ref. Debit Credit
Pe
ar
so
Balance
n
Ref. Debit Credit
L
No e
a
t F rn
or in
Balance
Di g
R
Ref. Debit Credit
s O e
tri r sa So
bu le lu
tio t
n io
Balance
n
Ref. Debit Credit
s
SG-206
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-207
Name __________________________________ Class ____________________ Date ____________________
T. FREEDMAN, CAPITAL ACCOUNT NO. 3000
Balance
Ref. Debit Credit
Pe
ar
so
n
T. FREEDMAN, WITHDRAWALS ACCOUNT NO. 3010
Balance
L
No e
Ref. Debit Credit
a
t F rn
or in
Di R g
s O e tri r sa So
Date
bu
Explanation Post
le lu
Debit Credit
Balance
tio t
Ref. Debit Credit
n io
n s
SG-207
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-208
Name __________________________________ Class ____________________ Date ____________________
Balance
Ref. Debit Credit
Pe
ar
so
n
a
Balance
t F rn
Ref. Debit Credit
or in
Di R g
s O e tri r sa So
bu le lu
Balance
tio t
io
Ref. Debit Credit
n n s
SG-208
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-209
Name __________________________________ Class ____________________ Date ____________________
Balance
Ref. Debit Credit
Pe
ar
so PHONE EXPENSE ACCOUNT NO. 5040
n
Balance
Ref. Debit Credit
No eL
a
t F rn
or in SUPPLIES EXPENSE ACCOUNT NO. 5050
Di R g Balance
s O e So
tri
Ref. Debit Credit
r sa
bu le lu
tio t io
n INSURANCE EXPENSE
n
ACCOUNT NO. 5060
s
Balance
Ref. Debit Credit
SG-209
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-210
Name __________________________________ Class ____________________ Date ____________________
Balance
Ref. Debit Credit
Pe
ar
so
DEPRECIATION EXPENSE, COMPUTER SHOP EQUIPMENT ACCOUNT NO. 5080
Balance
n
Ref. Debit Credit
No eL
a
t F rn
or in
Balance
Date
Di
Explanation
R g
Post Debit Credit
s O e
Ref. Debit Credit
tri r sa So
bu le lu
tio t io
n
MISCELLANEOUS EXPENSE ACCOUNT NO. 5100
Date Explanation Post

Ref.
Debit Credit
Debit
n
Balance
s
Credit
SG-210
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-211
Name __________________________________ Class ____________________ Date ____________________

TRIAL BALANCE
OCTOBER 31, 200X
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-211
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-212
Name __________________________________ Class ____________________ Date ____________________
Amount
Pe Sundry
Account
Category of Payment
ar
so
Supplies
Expense
n
No eL
Expense
Postage
a
t F rn
or in
Payment
Di R g
s O e tri r sa So
bu le lu
Receipts
tio t io
n n
Description
s
Voucher
No.Date
SG-212
65724_06_ch06_p186-213 4/15/09 11:50 AM Page SG-213
Name __________________________________ Class ____________________ Date ____________________

BANK RECONCILIATION AS OF SEPTEMBER 30, 200X
BALANCE PER BANK CHECKBOOK BALANCE
Bank Statement Balance Checkbook Balance
Pe
Add: _________________ Add:
ar
Deduct: _________ _________________
_________________ Deduct:
so _________________
Reconciled Balance
n _________________ Reconciled Balance _________________
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-213
65724_07_ch07_p214-232 4/15/09 11:50 AM Page SG-214
Payroll 7
Concepts and
P Pr o c e d u r e s —
E mepa l o y e e Ta x e s
rs
on
L
REGULAR EARNINGS
No e
OVERTIME
a
GROSS EARNINGS
t F rn
or in
Di g
FIT
SIT
s O e R
So
FICA - OASDI
FICA - Medicare
tri r sa
bu le lu
NET PAY
tio t io
n ns
SG-214
65724_07_ch07_p214-232 4/15/09 11:50 AM Page SG-215
Name __________________________________ Class ____________________ Date ____________________

FICA - OASDI
FICA - Medicare
FUTA
SUTA
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-215
65724_07_ch07_p214-232 4/15/09 11:50 AM Page SG-216
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 7
1. A.
Pe
B.
2.
ar
so
n
3.
No eL
a
t F rn
or in
4. A.
Di R g D.
s O e So
B. E.
C.
tri r
F.
sa
bu le lu
5.
A.
tio t
B.
io
C.
n
D.
n s
SG-216
65724_07_ch07_p214-232 4/15/09 11:50 AM Page SG-217
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 7
1. A.
Pe
B.
ar
2.
so
n
3.
No eL
a
t F rn
or in
4.
Di
A.
R g D.
s O e So
B. E.
C.
tri r sa
F.
bu le lu
5.
A.
tio t
B.
io
C.
n
D.
n s
SG-217
65724_07_ch07_p214-232 4/15/09 11:50 AM Page SG-218
Name __________________________________ Class ____________________ Date ____________________
FORMS FOR EXERCISES
7-1.
Carmen
Jill
Pe
Fred
ar
7-2.
Alvin Angelina
so
n
No eL
7-3.
a
t F rn
or in
Di R g
s O e tri r sa So
7-4.
bu le lu
tio t io
n n s
SG-218
65724_07_ch07_p214-232 4/15/09 11:50 AM Page SG-219
Name __________________________________ Class ____________________ Date ____________________
7-5.
Pe7-6.
ar
so
n
L
7-7. Employee Weekly Pay Weeks Total Taxable Tax Rate Tax
No e
a
t F rn
or in
Di g
7-8.
s O e R
tri r sa So
bu le lu
tio t io
n n s
SG-219
65724_07_ch07_p214-232 4/15/09 11:50 AM Page SG-220
Name __________________________________ Class ____________________ Date ____________________

Hourly # of Hours Gross
Employee Rate Worked Earnings
A.
B.
Pe
ar
C.
D.
so
n
A. B.
No eL
a
t F rn
or in
C. D.
Di R g
s O e tri r sa So
bu le lu
t
tio
Use the fold-out payroll register that accompanied your textbook.
io
PROBLEM 7A-3 OR PROBLEM 7B-3 n n

s
SG-220
65724_07_ch07_p214-232 4/15/09 11:50 AM Page SG-221
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 7
PAYROLL CONCEPTS AND PROCEDURES—EMPLOYEE TAXES
PART I INSTRUCTIONS
Pe 1.
2.
_______________ _______________ is gross pay less deductions.
Form _______________ aids the employer in knowing how much to deduct for federal income tax.
ar
3. The base for OASDI-Medicare will _______________ _______________ from year to year.
so
4. _______________ _______________ of the employer’s tax guide has tables available for deductions
for FIT and FICA (OASDI and Medicare).
5. _______________ _______________ _______________ protects employees against losses due to
n
injury or death incurred while on the job.
6. The two primary records used to keep track of payroll information are the _______________
L
_______________ and _______________ _______________ _______________.
No e
7. The employer is responsible for paying for_______________.
a
8. _______________ _______________ is paid every two weeks.
t F rn
9. A(n) _______________ employee will only be paid for the hours actually worked.
10. An employer must pay FUTA on wages earned by each employee up to a maximum of
or in
$_______________.
Di
R g
s O e tri
Answer true or false to the following.
r sa So
bu le lu
1. OASDI is the tax form for SUTA.
2. Employers only pay FUTA and SUTA.
tio t
3. Employers pay a higher FICA-OASDI tax rate than employees do.
4. Gross pay plus deductions equals net pay.
n io
n
5. Form W-4 aids in calculating FICA-OASDI.
s
6. The employer will match the employee’s contribution for FICA (OASDI and Medicare).
7. The maximum tax credit for state unemployment tax is .8%.
8. A company may have different types of employees.
9. The Wage-Bracket Table makes it more difficult to calculate the amount of deductions for FIT.
10. A calendar year has no effect on taxes for FICA-Social Security.
SG-221
65724_07_ch07_p214-232 4/15/09 11:50 AM Page SG-222
Name __________________________________ Class ____________________ Date ____________________

Complete the chart below (use table in text as needed). Use the following information: Before this payroll
Pete Bloom had earned $101,000. This week Pete earned $2,000 for the past two weeks. Assume an
OASDI rate of Social Security of 6.2% up to $102,000. Medicare, 1.45%. FIT is $238.50. The state income
tax is 7 percent.
Pe
DEDUCTIONS
GROSS PAY TAXABLE FICA FIT SIT NET
ar
FICA OASDI Med. PAY
so
n
No eL CHAPTER 7
Part I
a
t F rn
or in
1. Net Pay 6. payroll register, employee earnings record
2. W-4 7. FUTA (SUTA)
Di g
3. not change 8. Biweekly payroll
4. Circular E
s O e R 9. hourly
So
5. Workers’ Compensation Insurance 10. 7,000
Part II
tri r sa
1. false
bu 6. true
le lu
tio t
2. false 7. false
io
3. false 8. true
4. false 9. false
5. false 10. false
n n s
Part III
OASDI $1,000 x.062 = $ 62.00

Medicare 2,000 x.0145 = 29.00
FIT 238.50 $2,000.00
SIT 2,000 x.07 140.00 – 469.50
Total deductions $469.50 $1,530.50
SG-222
65724_07_ch07_p214-232 4/15/09 11:50 AM Page SG-223
Name __________________________________ Class ____________________ Date ____________________
(1)
GENERAL JOURNAL
Pe
PAGE 4
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-223
65724_07_ch07_p214-232 4/15/09 11:50 AM Page SG-224
Name __________________________________ Class ____________________ Date ____________________

GENERAL JOURNAL
PAGE 5
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-224
65724_07_ch07_p214-232 4/15/09 11:50 AM Page SG-225
Name __________________________________ Class ____________________ Date ____________________
Balance
Ref. Debit Credit
Pe
ar
so
n
No eL
a
t F rn
PETTY CASH ACCOUNT NO. 1010
Balance
or in
Ref. Debit Credit
Di g
s O e R
tri r sa So
bu
ACCOUNTS RECEIVABLE
le lu
ACCOUNT NO. 1020
tio t
Balance
io
Ref. Debit Credit
10/31 0X Balance forward ⻬
n 4
n
2 0 0 00
SG-225
65724_07_ch07_p214-232 4/15/09 11:50 AM Page SG-226
Name __________________________________ Class ____________________ Date ____________________
Balance
Ref. Debit Credit
Pe SUPPLIES ACCOUNT NO. 1030
ar Balance
so
Ref. Debit Credit
n
No eL
COMPUTER SHOP EQUIPMENT ACCOUNT NO. 1080
a
Balance
t F rn
Ref. Debit Credit
or in
Di R g
s O e
tri r sa So
Balance
10/31 0X Balance forward bu Ref.

⻬
le lu
Debit Credit
9 9 00
tio t io
n n s
SG-226
65724_07_ch07_p214-232 4/15/09 11:50 AM Page SG-227
Name __________________________________ Class ____________________ Date ____________________
Balance
Ref. Debit Credit
Pe
ar
Balance
so
Ref. Debit Credit
⻬
n
10/31 0X Balance forward 2 0 00
No eL ACCOUNTS PAYABLE ACCOUNT NO. 2000
Date
a
t F rn
Explanation Post
Ref.
Debit Credit
Debit
Balance
Credit
or in
Di R g
s O e tri r
WAGES PAYABLE
Date bu
Explanation Post
le lu
Debit Credit
Balance
tio t
Ref. Debit Credit
n io
n s
SG-227
65724_07_ch07_p214-232 4/15/09 11:50 AM Page SG-228
Name __________________________________ Class ____________________ Date ____________________
FICA—OASDI PAYABLE ACCOUNT NO. 2020
Balance
Ref. Debit Credit
Pe
ar
FICA—MEDICARE PAYABLE ACCOUNT NO. 2030
Balance
so
Ref. Debit Credit
n
No eL FIT PAYABLE ACCOUNT NO. 2040
Date Explanationa
t F rn Post
Ref.
Debit Credit
Debit
Balance
Credit
or in
Di R g
s O e tri r
SIT PAYABLE
bu
Balance
le lu
Ref. Debit Credit
tio t io
n n s
SG-228
65724_07_ch07_p214-232 4/15/09 11:50 AM Page SG-229
Name __________________________________ Class ____________________ Date ____________________
T. FREEDMAN CAPITAL ACCOUNT NO. 3000
Balance
Ref. Debit Credit
Pe
ar
T. FREEDMAN WITHDRAWALS ACCOUNT NO. 3010
Balance
so
Ref. Debit Credit
⻬
n
No eL
a
t F rn Balance
or in
Ref. Debit Credit
Di R g
s O e tri r sa So
bu le lu Balance
tio t
io
Ref. Debit Credit
n n
RENT EXPENSE
s
ACCOUNT NO. 5020
Balance
Ref. Debit Credit
SG-229
65724_07_ch07_p214-232 4/15/09 11:50 AM Page SG-230
Name __________________________________ Class ____________________ Date ____________________
Balance
Ref. Debit Credit
Pe PHONE EXPENSE ACCOUNT NO. 5040
ar Balance
so
Ref. Debit Credit
n
No eL SUPPLIES EXPENSE ACCOUNT NO. 5050
a
Balance
t F rn
Ref. Debit Credit
or in
10/31 0X ⻬ 4 2 00
Di R g
s O e INSURANCE EXPENSE
tri r sa So
ACCOUNT NO. 5060
Balance
bu le lu
Ref. Debit Credit
tio t io
n n
Date Explanation
POSTAGE EXPENSE
Post Debit Credit

ACCOUNT NO. 5070
Balance
s
Ref. Debit Credit
SG-230
65724_07_ch07_p214-232 4/15/09 11:50 AM Page SG-231
Name __________________________________ Class ____________________ Date ____________________
DEPRECIATION EXPENSE C. S. EQUIPMENT ACCOUNT NO. 5080
Balance
Ref. Debit Credit
Pe DEPRECIATION EXPENSE OFFICE EQUIPMENT ACCOUNT NO. 5090
ar Balance
so
Ref. Debit Credit
n
No eL MISCELLANEOUS EXPENSE ACCOUNT NO. 5100
Date a
t F rn
Explanation Post
Ref.
Debit Credit
Debit
Balance
Credit
or in
Di R g
s O e tri r
WAGES EXPENSE
Date bu
le lu Credit
Balance
tio t
Ref. Debit Credit
n io
(2) Use the fold-out payroll register that accompanied your textbook.
n s
SG-231
65724_07_ch07_p214-232 4/15/09 11:50 AM Page SG-232
Name __________________________________ Class ____________________ Date ____________________
(3)
TRIAL BALANCE
NOVEMBER 30, 200X
Dr. Cr.
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-232
65724_08_ch08_p233-257 4/15/09 11:50 AM Page SG-233
The 8
E m p l o y e r ’ s Ta x
PR esponsibilities:
Per
a i n c i p l e s
P rros c e d u r e s
a n d
on
L
No e
GENERAL JOURNAL
Date
a
t F rn
Account Titles and Description PR Dr.
PAGE 1
Cr.
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
SG-233
65724_08_ch08_p233-257 4/15/09 11:50 AM Page SG-234
Name __________________________________ Class ____________________ Date ____________________
1.
Pe
2.
ar
so
n
No eL
a
t F rn
or in
1. 2. 3. 4. 5. 6.
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-234
65724_08_ch08_p233-257 4/15/09 11:50 AM Page SG-235
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 8
1.
A.
B.
Pe
C.
D.
ar
E.
so
2.
A. ____________________________________________________________________________
n
B. ____________________________________________________________________________
C. ____________________________________________________________________________
L
D. ____________________________________________________________________________
No e
a
3.
t F rn
or in
4.
Di R g
s O e So
A. ____________________________________________________________________________
B.
tri r sa
____________________________________________________________________________
bu le lu
C. ____________________________________________________________________________
D. ____________________________________________________________________________
tio t
E. ____________________________________________________________________________
F.
io
____________________________________________________________________________
n n
G. ____________________________________________________________________________
s
5.
A. _____________
B. _____________
C. _____________
D. _____________
E. _____________
SG-235
65724_08_ch08_p233-257 4/15/09 11:50 AM Page SG-236
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 8
1.
A.
B.
Pe
C.
D.
ar
E.
so
2.
A. ____________________________________________________________________________
n
B. ____________________________________________________________________________
C. ____________________________________________________________________________
L
D. ____________________________________________________________________________
No e
a
3.
t F rn
or in
4.
Di R g
s O e So
A. ____________________________________________________________________________
B.
tri r sa
____________________________________________________________________________
bu le lu
C. ____________________________________________________________________________
D. ____________________________________________________________________________
tio t
E. ____________________________________________________________________________
F.
io
____________________________________________________________________________
n n
G. ____________________________________________________________________________
s
5.
A. _____________
B. _____________
C. _____________
D. _____________
E. _____________
SG-236
65724_08_ch08_p233-257 4/15/09 11:50 AM Page SG-237
Name __________________________________ Class ____________________ Date ____________________
FORMS FOR EXERCISES
8-1.
ACCOUNT CATEGORY DR/CR STATEMENT FOUND ON
Pe
ar
so
8-2.
n
No eL
a
t F rn
or in
Di R g
8-3.
s O e tri r sa So
bu le lu
tio t io
n n s
SG-237
65724_08_ch08_p233-257 4/15/09 11:50 AM Page SG-238
Name __________________________________ Class ____________________ Date ____________________
8-4.
Pe
ar
so
n
8-5.
No eL
a
t F rn
or in
Di g
8-6.
s O e R
8-7.
tri r sa So
bu le lu
8-8. tio t io
n n s
SG-238
65724_08_ch08_p233-257 4/15/09 11:50 AM Page SG-239
Name __________________________________ Class ____________________ Date ____________________

Allowance FICA
&
Employee Marital Status Gross OASDI Medicare Federal Income Tax
Pe
ar
so
n
No eL
(2)
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-239
65724_08_ch08_p233-257 4/15/09 11:50 AM Page SG-240
Name __________________________________ Class ____________________ Date ____________________
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-240
65724_08_ch08_p233-257 4/15/09 11:50 AM Page SG-241
Name __________________________________ Class ____________________ Date ____________________
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-241
65724_08_ch08_p233-257 4/15/09 11:50 AM Page SG-242
Name __________________________________ Class ____________________ Date ____________________
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-242
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Name __________________________________ Class ____________________ Date ____________________
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-243
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Name __________________________________ Class ____________________ Date ____________________
Pe
ar
so
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No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-244
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Name __________________________________ Class ____________________ Date ____________________
Pe
ar
so
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No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-245
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Name __________________________________ Class ____________________ Date ____________________
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-246
65724_08_ch08_p233-257 4/15/09 11:51 AM Page SG-247
Name __________________________________ Class ____________________ Date ____________________
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-247
65724_08_ch08_p233-257 4/15/09 11:51 AM Page SG-248
Name __________________________________ Class ____________________ Date ____________________
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-248
65724_08_ch08_p233-257 4/15/09 11:51 AM Page SG-249
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 8
THE EMPLOYER’S TAX RESPONSIBILITIES:
PRINCIPLES AND PROCEDURES
Part I Instructions
PeFill in the blank(s) to complete the statement.
ar
1. Form 941 is completed _______________.
2. The payroll tax expense for the employer is made up of _______________, _______________, and
so
3.
FUTA.
Data from the _______________ _______________ will provide the needed information to record
n
the payroll in the general journal.
4. SUTA is usually paid _______________.
L
5. FUTA Payable is a _______________ found on the _______________ _______________.
No e
6. Form 941 summarizes the taxes owed for _______________ and _______________.
a
7. _______________ _______________ _______________ will tell if a deposit is to be made
t F rn
monthly or semiweekly for FIT and Social Security.
8. Form _______________ is prepared quarterly to summarize tax liabilities for FICA (Social Security
or in
and Medicare) and FIT.
9. The _______________ _______________ _______________ _______________ is required to be
Di g
given to employees by January 31 following the year employed.
10.
s O e R
_______________ does not have a merit rating like SUTA.
tri r sa So
bu
Answer true or false to the following.
le lu
1.
tio
Prepaid Workers’ Compensation Insurance is a liability.
t io
n
2. Payroll taxes are recorded as assets for a business.
3.
4.
Payroll Tax Expense is made up of FICA, SUTA, and FIT.
Frequency of deposits relating to Form 941 is based on amount of tax liability in
look-back periods.
n s
5. The normal balance of FIT payable is a debit.
6. The individual earnings record provides the data to prepare W-2s.
7. A tax calendar provides little help to the employer involving the payment of tax liabilities.
8. Form 941 is completed twice a year.
9. A year-end adjusting entry is needed for workers’ compensation.
10. Form 8109 relates only to Form 940.
SG-249
65724_08_ch08_p233-257 4/15/09 11:51 AM Page SG-250
Name __________________________________ Class ____________________ Date ____________________
Complete the following table:

ACCOUNT CATEGORY FOUND ON WHICH REPORT
1. Salaries Payable
2. FUTA Payable
Pe3. SUTA Payable
ar
4. OASDI Tax Payable—Medicare
5. FIT Payable
so
6. Office Salaries Expense
n
Part IV Instructions
No eL
a
4 QUARTERS
t F rn
LOOK-BACK PERIOD
LIABILITY PAYROLL PAID WEEKLY TAX PAID BY:
or in
Sit. A $40,000 October ?
Sit. B 75,000
Di g
on Wed. ?
R
on Thurs. ?
s O e So
on Fri ?
tri r sa
on Sat. ?
on Sun. ?
bu on Mon.
on Tues.
le lu
?
?
tio t io
Why is the depositor in situation A classified as a monthly depositor while in situation B the depositor is
n
classified as semiweekly?

n s
Part I
1. quarterly 6. FICA (OASDI and

2. FICA (OASDI and Medicare), FIT
Medicare), SUTA 7. Look-back periods
3. payroll register 8. 941
4. quarterly 9. Wage and Tax Statement
5. liability, balance sheet 10. FUTA
SG-250
65724_08_ch08_p233-257 4/15/09 11:51 AM Page SG-251
Name __________________________________ Class ____________________ Date ____________________
Part II
1. false 6. true
2. false 7. false
3. false 8. false
4. true 9. true
Pe
5. false 10. false
ar
Part III
1. Liability; Balance Sheet
so
n
6.
L
Expense; Income Statement
No e
a
Part IV
t F rn
Situation A Nov. 15
B on Wed.
or in
on Thurs.
on Wed. of Week 2
Di g
on Fri.
R
on Sat.
s O e So
on Sun. Due Fri. of that week
tri r sa
on Mon.
on Tues.
bu le lu
The depositor in situation A is classified as a monthly depositor because its tax liability of $40,000 during the look-
back period was less than the $50,000 limit.
tio t io
On the other hand, the depositor in situation B owed $75,000 during the look-back period. Since this is greater than
n
the $50,000 limit, it was classified as a semiweekly depositor.
n s
SG-251
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Name __________________________________ Class ____________________ Date ____________________

GENERAL JOURNAL
PAGE 5
Pe
ar
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or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-252
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Name __________________________________ Class ____________________ Date ____________________

GENERAL JOURNAL
PAGE 6
ar
so
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No eL
a
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or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-253
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Name __________________________________ Class ____________________ Date ____________________

Pe
ar
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n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-254
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Name __________________________________ Class ____________________ Date ____________________

Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-255
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Name __________________________________ Class ____________________ Date ____________________
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-256
65724_08_ch08_p233-257 4/15/09 11:51 AM Page SG-257
Name __________________________________ Class ____________________ Date ____________________
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-257
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-258
9
Sales and Cash
P
Receipts
ea
rs
on
L
1. 2. 3. 4. 5.
No e
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
SG-258
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-259
Name __________________________________ Class ____________________ Date ____________________
SELF-REVIEW QUIZ 9-2 BERNIE COMPANY

GENERAL JOURNAL
PAGE 1
Pe
ar
so
n
No eL
NAME
ADDRESS
LEE CORP.
a
t F rn
ACCOUNTS RECEIVABLE SUBSIDIARY LEDGER
118 MORRIS RD., BOSTON, MA 01935
or in
Di g
Date Explanation Post Debit Credit Dr. Balance
Ref.
s O e R
tri r sa So
bu le lu
tio t io
n n s
NAME RING COMPANY
ADDRESS 31 NORRIS ROAD, BOSTON, MA 01935

Ref.
SG-259
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Name __________________________________ Class ____________________ Date ____________________
PARTIAL GENERAL LEDGER
ACCOUNT RECEIVABLE ACCOUNT NO. 141

Balance
Ref. Debit Credit
Pe
ar
so SALES ACCOUNT NO. 310
n
Balance
L
Ref. Debit Credit
No e
a
t F rn
or in
SALES RETURNS AND ALLOWANCES ACCOUNT NO. 312
Balance
Di g
R
Ref. Debit Credit
s O e tri r sa So
bu le lu
tio t io
n n s
SG-260
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Name __________________________________ Class ____________________ Date ____________________

MABEL CORPORATION
GENERAL JOURNAL
PAGE 3
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or in
Di R g
s O e tri r sa So
bu le lu
tio t io
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SG-261
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Name __________________________________ Class ____________________ Date ____________________

Balance
200X Ref. Debit Credit
May 1 Balance ⻬ 6 0 0 00
Pe
ar
so
n
a
Balance
t F rn
or in
Di R g
s O e tri r
STORE EQUIPMENT
bu
Balance
le lu
tio t io
n n
SALES ACCOUNT NO. 410
s
Balance
SG-262
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-263
Name __________________________________ Class ____________________ Date ____________________
SALES DISCOUNT ACCOUNT NO. 420

Balance
Pe
ar
so
NAME
ADDRESS
JANIS FROSS
81 FOSTER RD., BEVERLY, MA 09125
n
L
No e
200X Ref.
a
t F rn
or in
Di g
s O e R
tri So
NAME IRENE WELCH
ADDRESS
r
10 RONG RD., BEVERLY, MA 01215
sa
Date bu
Explanation Post
le lu Debit Credit Dr. Balance
tio t
200X Ref.
May 1 Balance
n
⻬
io 5 0 0 00
n s
SG-263
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-264
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 9
1.
Pe
ar
2.
so
n
No eL
a
t F rn
or in
Di R g
3. s O e tri r sa So
bu le lu
A. ________ ________ ________
B. ________ ________ ________
tio t
C. ________ ________ ________
n io
n
4.
SG-264
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Name __________________________________ Class ____________________ Date ____________________
5.
PAGE 6
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e
6. BLUE CO.
So
SCHEDULE OF ACCOUNTS RECEIVABLE
tri r sa
MAY 31, 200X
bu le lu
tio t io
n ns
SG-265
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-266
Name __________________________________ Class ____________________ Date ____________________
FORMS FOR EXERCISES
9-1.
Amazon.com Accounts Receivable 112
Pe Bill Valley Co. Sales 412
ar
9-2. so
n GENERAL JOURNAL
L
PAGE 1
No e
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
Bass Co.
n Sales 411
n s
Ronald Co. Accounts Receivable 112 Sales Returns & Allowances 412
SG-266
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Name __________________________________ Class ____________________ Date ____________________
9-3.
Pe
ar
so
9-4. EDNA CO.
n
GENERAL JOURNAL
PAGE 1
L
No e
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-267
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Name __________________________________ Class ____________________ Date ____________________
GENERAL JOURNAL (CONTINUED) PAGE 1
Pe
ar
ACCOUNTS RECEIVABLE SUBSIDIARY LEDGER PARTIAL GENERAL LEDGER
so Boston Co. Cash 111
n
L
Gary Co. Accounts Receivable 113
No e
a
t F rn
Edna Cares, Capital 311
or in Sales 411
Di R g
s O e tri r sa So
Sales Returns &
Allowances 412
bu le lu
tio t
Sales Discount 413
n io
n
EDNA CO.
s
JUNE 30, 200X
9-5.
SG-268
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-269
Name __________________________________ Class ____________________ Date ____________________
PIZZA AND MORE

GENERAL JOURNAL
Pe
PAGE 1
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-269
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Name __________________________________ Class ____________________ Date ____________________
NAME CINDY CO.

ADDRESS 942 MOSE ST., REVERE, MA 01938
Pe
Ref.
ar
so
n
No eL
a
NAME FRENCH CO.
t F rn
ADDRESS 8 JOSS AVE., LYNN, MA 01947
or in
Ref.
Di R g
s O e tri r sa So
bu le lu
tio t io
n
NAME GROOM CO.
ADDRESS
Date
10 LOST RD., TOPSFIELD, MA 01998
Explanation Post
Ref.
Debit Credit
n s
Dr. Balance
SG-270
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-271
Name __________________________________ Class ____________________ Date ____________________
PIZZA AND MORE

GENERAL LEDGER

Balance
Pe
Ref. Debit Credit
ar
so
n
No eL
a
PIZZA SALES ACCOUNT NO. 410
t F rn
Balance
or in
Ref. Debit Credit
Di R g
s O e tri r GROCERY SALES
bu le lu
Balance
tio t
Ref. Debit Credit
n io
SALES RETURNS AND ALLOWANCES
n
ACCOUNT NO. 412s
Balance
Ref. Debit Credit
SG-271
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-272
Name __________________________________ Class ____________________ Date ____________________
PIZZA AND MORE

JUNE 30, 200X
Pe
ar
so
n
L
TED’S AUTO SUPPLY
GENERAL JOURNAL
No e
PAGE 2
Date
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-272
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-273
Name __________________________________ Class ____________________ Date ____________________
NAME LANCE CORNER

ADDRESS 9 ROE ST., BARTLETT, NH 01382
Pe Date Explanation Post Debit Credit Dr. Balance

200X Ref.
ar
Nov 1 Balance ⻬ 4 0 0 00
so
n
NAME
No e
J. SETH
L
a
ADDRESS 22 REESE ST., LACONIA, NH 04321
Date
t F rn Explanation Post Debit Credit Dr. Balance
or in
200X Ref.
Di
Nov 1 Balance 2 0 0 00
s O e R g
tri r sa So
bu le lu
t
NAME R. VOLAN
ADDRESS
tio
12 ASTER RD., MERRIMACK, NH 02134
io
Date Explanation
n Post Debit
n
Credit Dr. Balance
s
200X Ref.
Nov 1 Balance ⻬ 1 0 0 0 00
SG-273
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-274
Name __________________________________ Class ____________________ Date ____________________

TED’S AUTO SUPPLY
Balance
Pe
Nov 1 Balance ⻬ 1 6 0 0 00
ar
so
n
L
SALES TAX PAYABLE ACCOUNT NO. 210
No e
Balance
a
t F rn
Nov 1 Balance ⻬ 1 6 0 0 00
or in
Di R g
s O e tri r
AUTO PARTS SALES
bu le lu
Balance
tio t
Ref. Debit Credit
n io
n
ACCOUNT NO. 420 s
Balance
Ref. Debit Credit
SG-274
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-275
Name __________________________________ Class ____________________ Date ____________________
(3)
TED’S AUTO SUPPLY
NOVEMBER 30, 200X
Pe
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No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-275
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Name __________________________________ Class ____________________ Date ____________________

(1,2)
PEAKER’S SNEAKER SHOP
GENERAL JOURNAL
PAGE 2
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-276
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-277
Name __________________________________ Class ____________________ Date ____________________

(1,2)
GENERAL JOURNAL
PAGE 3
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
SG-277
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-278
Name __________________________________ Class ____________________ Date ____________________

NAME B. DALE
ADDRESS 1822 RIVER RD., MEMPHIS, TN 09111
Pe
Date
200X
Explanation Post
Ref.
Debit Credit Dr. Balance
ar
so
n
NAME
ADDRESS
RON LESTER
No eL
18 MASS. AVE., SAN DIEGO, CA 01999
Date
a
t F rn
Explanation Post
Ref.
or in
Di R g
s O e tri r sa So
bu le lu
tio t
io
NAME PAM PRY
n
ADDRESS 918 MOORE DR., HOMEWOOD, IL 60430
Date
200X
May 1 Balance
Explanation Post
Ref.
⻬
Debit Credit
n s
Dr. Balance
6 0 0 00
SG-278
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-279
Name __________________________________ Class ____________________ Date ____________________

NAME JIM ZON
ADDRESS 2 CHESTNUT ST., SWAMPSCOTT, MA 01970

200X Ref.
Pe
ar
so
n PEAKER’S SNEAKER SHOP
L
No e
CASH ACCOUNT NO. 10
a
Balance
t F rn
May 1 Balance ⻬ 15 5 0 0 00
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-279
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-280
Name __________________________________ Class ____________________ Date ____________________

Balance
Pe
May 1 Balance ⻬ 2 2 0 0 00
ar
so
n
No eL
a
t F rn
or in
SNEAKER RACK EQUIPMENT ACCOUNT NO. 14
Balance
Date
Di R
Explanation
g
Post Debit Credit
s O e
So
⻬
tri
May 1 Balance 1 0 0 0 00
r sa
bu le lu
tio
MARK PEAKER, CAPITAL
t io
ACCOUNT NO. 30
n n
Balance
s
May 1 Balance ⻬ 40 0 0 0 00
SG-280
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-281
Name __________________________________ Class ____________________ Date ____________________
Balance
Pe
May 1 Balance ⻬ 2 2 0 0 00
ar
so
n
No eL
a
t F rn
SALES DISCOUNT ACCOUNT NO. 42
or in
Balance
Di g
s O e R
tri r sa So
bu le lu
SALES RETURNS & ALLOWANCES ACCOUNT NO. 44
Balance
tio t io
n n s
SG-281
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-282
Name __________________________________ Class ____________________ Date ____________________
(3)
MAY 31, 200X
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-282
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-283
Name __________________________________ Class ____________________ Date ____________________
BILL’S COSMETIC MARKET

GENERAL JOURNAL
PAGE 1
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
SG-283
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-284
Name __________________________________ Class ____________________ Date ____________________

GENERAL JOURNAL
PAGE 2
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-284
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-285
Name __________________________________ Class ____________________ Date ____________________

NAME ALICE KOY CO.
ADDRESS 2 RYAN RD., BUFFALO, NY 09113
Pe Date Explanation Post Debit Credit Debit
ar
Ref. Balance
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-285
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-286
Name __________________________________ Class ____________________ Date ____________________
NAME RUSTY NEAL CO.

ADDRESS 4 REEL RD., LANCASTER, PA 04332
Pe
Date Explanation Post Debit Credit Debit
Ref. Balance
ar
so
n
NAME
No eL
MARIKA SANCHEZ CO.
a
ADDRESS 14 BONE DR., ENGLEWOOD CLIFFS, NJ 07632
Date
t F rn
Explanation Post Debit Credit Debit
or in
Ref. Balance
Di R g
s O e tri r sa So
bu le lu
tio t io
n n
NAME JEFF TONG CO.
s
ADDRESS 2 MARION RD., BOSTON, MA 01981
Date Explanation Post Debit Credit Debit

Ref. Balance
SG-286
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-287
Name __________________________________ Class ____________________ Date ____________________

GENERAL LEDGER
CASH ACCOUNT NO. 10
Balance
Pe
Ref. Debit Credit
ar
so
n
No eL
a
t F rn
Balance
or in
Ref. Debit Credit
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-287
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-288
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar
so
n
No eL
a
t F rn BILL MURRAY, CAPITAL ACCOUNT NO. 30
or in
Balance
Di g
Ref. Debit Credit
s O e R
tri r sa So
bu le lu
tio
LIPSTICK SALES
t io
ACCOUNT NO. 40
n n
Balance
s
Ref. Debit Credit
SG-288
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-289
Name __________________________________ Class ____________________ Date ____________________
SALES RETURNS & ALLOWANCES, LIPSTICK ACCOUNT NO. 42

Balance
Ref. Debit Credit
Pe
ar
so
n
EYE SHADOW SALES ACCOUNT NO. 44
Balance
L
No e
Ref. Debit Credit
a
t F rn
or in
Di R g
s O e So
(3) BILL’S COSMETIC MARKET
tri r sa
APRIL 30, 200X
bu le lu
tio t io
n n s
SG-289
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-290
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 9
SALES AND CASH RECEIPTS
Part I Instructions
Pe
1. The normal balance of sales returns and allowances is _______________.
2. _______________ _______________ and _______________ is a contra-revenue account.
ar
3. Sales is a(n) _______________ account.
4. A discount period is less time than the _______________ _______________.
so
5. A debit to accounts receivable and a credit to sales records the sale of merchandise _______________
_______________.
6. The _______________ _______________ _______________ _______________ lists in
n
alphabetical order an account for each customer.
7. _______________ _______________ in the general ledger is called the controlling account.
L
8. The (⻬) in the PR column of the general journal indicates that the accounts receivable ledger has
been updated _______________ _______________ _______________.
No e
9. Issuing _______________ _______________ results in a debit to sales returns and allowancs and a
a
credit to accounts receivable.
t F rn
10. In a wholesale company there is no _______________ tax.
11. Sales Tax Payable is a(n) _______________ in the general ledger.
or in
12. Cash sales result in a(n) _______________ to cash and a _______________ to sales.
13. Sales Returns and Allowances is a(n) _______________ _______________ account.
Di g
14. The _______________ _______________ has to be posted to the general as well as the sales ledger.
R
15. No _______________ _______________ are taken on sales tax.
s O e
16.
So
A(n) _______________ _______________ _______________ _______________ lists the ending
tri
balances from the accounts receivable ledger.
r sa
bu le lu
Part II
Complete the following chart:
Transaction
tio Dr.
t Cr.
io
n
1. Sale for cash ________________ ______________
2.
3.
4.
Issued credit memo
Sale on account
Received cash payment less discount
________________
________________
________________
______________
______________
______________
n s
Partial Chart of Accounts
10 Cash 40 Sales
20 Accounts Receivable 42 Sales Discount
44 Sales Returns and Allowances
SG-290
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-291
Name __________________________________ Class ____________________ Date ____________________

1. A schedule of accounts receivable shows what customers do not owe.

2. A perpetual system would keep continual track of inventory.
3. Sales Discount policies can never change.
Pe
4. Sales Tax Payable is an asset.
5. Sales Discount is a contra asset.
6. Issuing a credit memorandum results in Sales, Returns and Allowances decreasing with Accounts
ar
Receivable increasing.
7. The sum of the accounts receivable subsidiary ledger is equal to the balance in the controlling account
so
at the end of the month.
8. The buyer issues the credit memo.
n
9. The accounts receivable subsidiary ledger is listed in numerical order.
10. Sales Discount is a contra-revenue account.
L
11. Net sales = gross sales − SRA-SD.
No e
12. The normal balance of an Accounts Receivable ledger is a debit.
a
13. Discounts are taken on sales tax.
t F rn
14. 2/10, N/30 means a cash discount is good for 30 days.
15. The accounts receivable subsidiary ledger is always located in the general ledger.
or in
16. Gross profit plus operating expenses equals net income.
17. A credit period is longer than the discount period.
Di g
18. In the accounts receivable subsidiary ledger each account is debited to record amounts customers owe.
19.
s O e R
Sales Tax Payable is an asset.
tri r CHAPTER 9
sa So
bu le lu
Part I
tio t io
n n
1. debit 9. credit memorandum
2. Sales Returns, Allowances 10. sales
3.
4.
5.
revenue
credit period
on account
11.
12.
13.
liability
debit, credit
contra-revenue
s
6. accounts receivable subsidiary ledger 14. journalized transaction
7. Accounts Receivable 15. cash discounts
8. during the month 16. schedule of accounts receivable
SG-291
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-292
Name __________________________________ Class ____________________ Date ____________________
Part II
Dr. Cr.
1. 10 40
2. 44 20
3. 20 40
Pe
4. 10 20
42
ar
so
Part III
1. false 11. true
n
2. true 12. true
3. false 13. false
L
4. false 14. false
No e
5. false 15. false
a
6. false 16. false
t F rn
7. true 17. true
8. false 18. true
or in
9. false 19. false
10. true
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-292
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-293
Name __________________________________ Class ____________________ Date ____________________

GENERAL JOURNAL
PAGE 4
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-293
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Name __________________________________ Class ____________________ Date ____________________

1/31/0X
Pe CASH ACCOUNT NO. 1000
ar
Balance
so
Ref. Debit Credit
1/1 0X Balance Forward ⻬ 3 3 3 6 65
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-294
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-295
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
1/1 0X Balance Forward ⻬ 13 6 0 0 00
ar
so
n
No eL
a
t F rn
Balance
or in
Ref. Debit Credit
Di R g
s O e tri r sa So
bu le lu
SALES RETURNS & ALLOWANCES ACCOUNT NO. 4020
tio t io
Balance
n
Ref. Debit Credit
n s
SG-295
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-296
Name __________________________________ Class ____________________ Date ____________________
SALES DISCOUNTS ACCOUNT NO. 4030

Balance
Ref. Debit Credit
Pe
ar
so
ACCOUNTS RECEIVABLE
SUBSIDIARY LEDGER
n
NAME TAYLOR GOLF ACCOUNT NO. 100
ADDRESS 1010 MOCKINGBIRD LANE, CARLSBAD, CA 92008
Date
No eL
Explanation Post Debit Credit Dr. Balance
a
Ref.
t F rn
or in
Di R g
NAME
s O e
VITA NEEDLE
tri r sa So ACCOUNT NO. 101
ADDRESS
bu
144 CANTATA, IRVINE, CA 92606
le lu
Date Explanation
tio Post
Ref.
Debit
t Credit
io
Dr. Balance
1/1 0X Balance
n ⻬
n
6 8 0 0 00
SG-296
65724_09_ch09_p258-297 4/15/09 11:51 AM Page SG-297
Name __________________________________ Class ____________________ Date ____________________
NAME ACCU PAC ACCOUNT NO. 103

ADDRESS 1717 JORDAN ST., SAN CLEMENTE, CA 91607
Pe
Ref.
1/1 0X Balance ⻬ 3 9 0 0 00
ar
so
NAME
n
ANTHONY J. PITALE ACCOUNT NO. 104
L
ADDRESS 600 NEWPORT BEACH, NEWPORT, CA 91600
No e
a
Ref.
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-297
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-298
10
Purchases and
CPa s h P a y m e n t s
ea
rs
on
L
1. –––––––––– 2. –––––––––– 3. –––––––––– 4. –––––––––– 5. ––––––––––
No e
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-298
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Name __________________________________ Class ____________________ Date ____________________

MUNROE CO.
GENERAL JOURNAL
PAGE 1
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-299
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-300
Name __________________________________ Class ____________________ Date ____________________
ACCOUNTS PAYABLE SUBSIDIARY LEDGER

NAME JOHN BUTLER COMPANY
ADDRESS 18 REED RD., HOMEWOOD, IL 60430
Date Explanation Post Debit Credit Cr. Balance

Ref.
Pe
ar
NAME
so FLYNN COMPANY
n
ADDRESS 15 FOSS AVE., ENGLEWOOD CLIFFS, NJ 07632
L
No e
Ref.
a
t F rn
or in
Di g
s O e R
So
tri r sa
Balance
bu le lu
Ref. Debit Credit
tio t io
n n s
SG-300
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-301
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar
PURCHASES ACCOUNT NO. 512
Balance
so
Ref. Debit Credit
n
No eL
a
PURCHASES RETURNS AND ALLOWANCES ACCOUNT NO. 513
t F rn
Balance
Ref. Debit Credit
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-301
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-302
Name __________________________________ Class ____________________ Date ____________________
MELISSA COMPANY
GENERAL JOURNAL
PAGE 2
Pe
ar
so
n
No eL
a
t F rn
or in
ACCOUNTS PAYABLE SUBSIDARY LEDGER
NAME
Di
BOB FINKELSTEIN
R g
s O e So
ADDRESS 112 FLYING HIGHWAY, TRENTON, NJ 00861
tri r Post
sa
bu
Date Explanation Debit Credit Cr. Balance
le lu
200X Ref.
t
⻬
tio
June 1 Balance 3 0 0 00
n io
NAME AL JEEP
n s
ADDRESS 118 WANG RD., SAUGUS, MA 01432

200X Ref.
June 1 Balance ⻬ 2 0 0 00
SG-302
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-303
Name __________________________________ Class ____________________ Date ____________________

Balance
Pe
ar
so
Balance
n
L
No e
a
t F rn
or in
PURCHASES DISCOUNT ACCOUNT NO. 511
Di
Balance
R g
s O e
Ref. Debit Credit
tri r sa So
bu le lu
tioADVERTISING EXPENSE t io
ACCOUNT NO. 610
n n
Balance
s
Ref. Debit Credit
SG-303
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-304
Name __________________________________ Class ____________________ Date ____________________
PETE’S CLOCK SHOP

GENERAL JOURNAL
PAGE 2
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No eL
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or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-304
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-305
Name __________________________________ Class ____________________ Date ____________________
PETE’S CLOCK SHOP

GENERAL JOURNAL
PAGE 3
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ar
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No eL
a
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or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-305
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-306
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 10
1. A. ____________________ D. ____________________
B. ____________________ E. ____________________
C. ____________________ F. ____________________
2.
Pe
ar
3.
so
____________________________________________________________________________
n
____________________________________________________________________________
L
____________________________________________________________________________
No e
____________________________________________________________________________
a
____________________________________________________________________________
t F rn
____________________________________________________________________________
____________________________________________________________________________
or in
____________________________________________________________________________
Di g
4. A. ____________________
s O e
B. ____________________
R
tri
C. ____________________
r sa So
5.
bu le lu
tio t io
n n s
SG-306
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-307
Name __________________________________ Class ____________________ Date ____________________
6.
WEB.COM
SCHEDULE OF ACCOUNTS PAYABLE
MAY 31, 200X
Pe
ar
so
n
No eL
a
7.
t F rn
FORM FOR CLASSROOM DEMONSTRATION EXERCISES 8, 9, 10
Date
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-307
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Name __________________________________ Class ____________________ Date ____________________
FORMS FOR EXERCISES
10-1.
Lee’s.com Equipment 120
Pe
Lane.com Accounts Payable 210
ar Sail.com Purchases 510
so
10-2.
n PAGE 1
No eL
a
t F rn
or in
Di R g Purchases Returns and
s O e So
Reel Co. Accounts Payable 211 Allowances 513
tri r sa
bu le lu
tio t io
n n s
SG-308
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Name __________________________________ Class ____________________ Date ____________________
10-3. PAGE 2
Pe
ar
so
n
No eL
a
t F rn
or in
ACCOUNTS PAYABLE SUBSIDIARY LEDGER PARTIAL GENERAL LEDGER
Di A. James
R g Cash 110
s O e So
1,000 3,000
tri r sa
bu le lu
B. Foss Accounts Payable 210
400 2,400
J. Ranch
tio t io
Purchases Discount 511
n n
900
B. Swanson
100 s
Advertising Expense 610
SG-309
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-310
Name __________________________________ Class ____________________ Date ____________________
10-4.
MORGAN’S CLOTHING
APRIL 30, 200X
Pe
ar
so
Accounts Payable 210
n
10-5.
No eL
a
Accounts Affected Category ↑↓ Rules
t F rn
or in
Di R g
10-6. s O e tri r sa So
bu le lu
tio t io
n n s
SG-310
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-311
Name __________________________________ Class ____________________ Date ____________________
FORM FOR EXERCISES 10-7, 10-8, 10-9, 10-10
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-311
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-312
Name __________________________________ Class ____________________ Date ____________________
FORM FOR EXERCISES 10-7, 10-8, 10-9, 10-10 (CONTINUED)
Pe
ar
CALCULATIONS PAGE FOR 10-7 TO 10-10
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-312
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Name __________________________________ Class ____________________ Date ____________________

RON’S SKATE SHOP
GENERAL JOURNAL
PAGE 2
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns
SG-313
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-314
Name __________________________________ Class ____________________ Date ____________________

NAME MAIL.COM
ADDRESS 12 SMITH ST., DEARBORN, MI 09113
Pe
Ref.
ar
so
n
NAME NORTON CO.
ADDRESS 1 RANTOUL RD., CHARLOTTE, NC 01114
Date
No eL
Explanation Post Debit Credit Cr. Balance
a
Ref.
t F rn
or in
Di R g
s O e
NAME ROLO CO.
ADDRESS
tri r
2 WEST RD., LYNN, MA 01471
sa So
bu le lu
Ref.
tio t io
n n
STORE SUPPLIES ACCOUNT NO. 115

s
Balance
Ref. Debit Credit
SG-314
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-315
Name __________________________________ Class ____________________ Date ____________________
STORE EQUIPMENT ACCOUNT NO. 121

Balance
Ref. Debit Credit
Pe
ar
so ACCOUNTS PAYABLE ACCOUNT NO. 210
n
Balance
L
Ref. Debit Credit
No e
a
t F rn
or in
Di R g
Date
s O e tri r
Explanation
PURCHASES
Post
sa So
Debit Credit
ACCOUNT NO. 510
Balance
bu Ref.
le lu
Debit Credit
tio t io
n n s
SG-315
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-316
Name __________________________________ Class ____________________ Date ____________________
MABEL’S NATURAL FOOD

PAGE 2
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Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-316
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Name __________________________________ Class ____________________ Date ____________________

NAME ATON CO.
ADDRESS 11 LYNNWAY AVE., NEWPORT, RI 03112
Pe
200X Ref.
ar
May 1 Balance 4 0 0 00
so
n
NAME BROWARD CO.
L
ADDRESS 21 RIVER ST., ANAHEIM, CA 43110
No e
a
200X Ref.
t F rn
or in
Di R g
s O e So
NAME MIDDEN CO.
tri r sa
ADDRESS 10 ASTER RD., DUBUQUE, IA 80021
Date
200X
bu
Explanation Post
Ref.
le lu
Debit Credit Cr. Balance
May 1 Balance
tio ⻬
t io
1 2 0 0 00
n n
NAME
ADDRESS
RELAR CO.
22 GERALD RD., SMITH, CO 43138 s
200X Ref.
SG-317
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Name __________________________________ Class ____________________ Date ____________________

Balance
Pe
Ref. Debit Credit
ar
so OFFICE EQUIPMENT ACCOUNT NO. 120
Balance
n
Ref. Debit Credit
No eL
a
t F rn ACCOUNTS PAYABLE ACCOUNT NO. 210
or in
Balance
Di g
May 1 Balance
s O e R ⻬ 2 7 0 0 00
tri r sa So
bu le lu
tio t io
n n
Balance
s
May 1 Balance ⻬ 16 0 0 0 00
SG-318
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Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar
so MABEL’S NATURAL FOOD
n
MAY 31, 200X
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-319
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Name __________________________________ Class ____________________ Date ____________________

PAGE 5
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No eL
a
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or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-320
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-321
Name __________________________________ Class ____________________ Date ____________________

NAME ALVIN CO.
ADDRESS 1 REACH RD., IPSWICH, MA 01932
Pe
200X Ref.
May 1 Balance ⻬ 1 2 0 0 00
ar
so
n
NAME HENRY CO.
ADDRESS 1 RALPH RD., REVERE, MA 01321
Date
No eL Explanation Post Debit Credit Cr. Balance
a
200X Ref.
t F rn
or in
NAME
Di SOY CO.
R g
s O e So
ADDRESS 7 PLYMOUTH AVE., GLENN, NH 01218
tri r sa
bu
Post
le lu
Date Explanation Debit Credit Cr. Balance
200X Ref.
tio t
n io
NAME
ADDRESS
XON CO.
22 REY RD., BOCA RATON, FL 99132
n s
200X Ref.
May 1 Balance ⻬ 1 4 0 0 00
SG-321
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-322
Name __________________________________ Class ____________________ Date ____________________

Balance
Pe
May 1 Balance ⻬ 17 0 0 0 00
ar
so
n
No eL
a
DELIVERY TRUCK ACCOUNT NO. 150
t F rn
Balance
or in
Di R g
s O e tri r
ACCOUNTS PAYABLE

Balance
Date
200X
Explanation
bu Post
Ref.
Debit
le lu
Credit
Debit Credit
tio t
May 1 Balance ⻬ 4 0 0 0 00
n io
n s
COMPUTER PURCHASES ACCOUNT NO. 510
Balance
SG-322
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Name __________________________________ Class ____________________ Date ____________________
COMPUTER PURCHASES DISCOUNT ACCOUNT NO. 511

Balance
Ref. Debit Credit
Pe
ar
so RENT EXPENSE ACCOUNT NO. 610
Balance
n
Ref. Debit Credit
No eL
a
t F rn
or in
Di g
Balance
R
s O e So
Ref. Debit Credit
tri r sa
bu le lu
tio t io
n
JONES COMPUTER CENTER
n
s
MAY 31, 200X
SG-323
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-324
Name __________________________________ Class ____________________ Date ____________________

(1)
ABBY’S TOY HOUSE

GENERAL JOURNAL
Pe
PAGE 1
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-324
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Name __________________________________ Class ____________________ Date ____________________
PAGE 2
Pe
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No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-325
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Name __________________________________ Class ____________________ Date ____________________
PAGE 3
Pe
ar
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n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-326
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Name __________________________________ Class ____________________ Date ____________________
PAGE 4
Pe
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n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-327
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Name __________________________________ Class ____________________ Date ____________________
PAGE 5
Pe
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No eL
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or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-328
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-329
Name __________________________________ Class ____________________ Date ____________________

(2) ACCOUNTS PAYABLE SUBSIDIARY LEDGER
NAME MINNIE KATZ
ADDRESS 87 GARFIELD AVE., REVERE, MA 01245
Pe
Ref.
ar
so
n
NAME SAM KATZ GARAGE
ADDRESS 22 REGIS RD., BOSTON, MA 01950
Date
No eL Explanation Post Debit Credit Cr. Balance
a
Ref.
t F rn
or in
Di g
NAME EARL MILLER CO.
ADDRESS
R
22 RETTER ST., SAN DIEGO, CA 01211
s O e tri r sa So
Ref.
bu le lu
tio t io
n n
NAME
ADDRESS
WOODY SMITH
2 SPRING ST., WEERS, ND 02118
s
Ref.
SG-329
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Name __________________________________ Class ____________________ Date ____________________

NAME BILL BURTON
ADDRESS 24 RYAN RD., BUIKE, OH 02183
Pe
Ref.
ar
so
n
No eL
NAME
ADDRESS
BONNIE FLOW CO.
a
t F rn
2 SMITH RD., DALLAS, TX 22210
Date
or in
Di g
Ref.
s O e R
tri r sa So
bu le lu
tio t
NAME JIM REX
io
ADDRESS 1 SCHOOL ST., CLEVELAND, OH 22441
Date Explanation
n Post Debit Credit
n
Dr. Balance
s
Ref.
SG-330
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-331
Name __________________________________ Class ____________________ Date ____________________

NAME AMY ROSE
ADDRESS 18 VEEK RD., CHESTER, CT 80111

Ref.
Pe
ar
so
n GENERAL LEDGER
L
Balance
No e
a
Ref. Debit Credit
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-331
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-332
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
Balance
s O e
So
Ref. Debit Credit
tri r sa
bu le lu
tio
DELIVERY TRUCK
t io
ACCOUNT NO. 121
n n
Balance
s
Ref. Debit Credit
SG-332
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-333
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar
so
n
No eL
a
t F rn
or in A. ELLEN, CAPITAL ACCOUNT NO. 310
Di R g
Balance
s O e
So
Ref. Debit Credit
tri r sa
bu le lu
tio t io
TOY SALES ACCOUNT NO. 410
Balance
n n
Ref. Debit Credit
SG-333
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Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar
so
Balance
n
Ref. Debit Credit
No eL
a
t F rn TOY PURCHASES ACCOUNT NO. 510
or in
Balance
Di g
Ref. Debit Credit
s O e R
tri r sa So
bu le lu
tio t io
n n
s
Balance
Ref. Debit Credit
SG-334
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-335
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar SALARIES EXPENSE ACCOUNT NO. 610
so
Balance
n
Ref. Debit Credit
No eL
a
t F rn
CLEANING EXPENSE ACCOUNT NO. 612
Balance
or in
Ref. Debit Credit
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-335
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-336
Name __________________________________ Class ____________________ Date ____________________
(3)
ABBY’S TOY HOUSE
MARCH 31, 200X
Pe
ar
so
n
L
(3)
No e
ABBY’S TOY HOUSE
a
MARCH 31, 200X
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-336
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-337
Name __________________________________ Class ____________________ Date ____________________
PAGE 3
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-337
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-338
Name __________________________________ Class ____________________ Date ____________________
PAGE 4
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-338
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-339
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 10
PURCHASES AND CASH PAYMENTS
Part I Instructions
Pe
1. The trend in accounting is more to inventory rather than
inventory.
ar
2. Purchase discounts are categorized as a(n) account.
so
3. The Purchases account has a balance.
4. Purchases are defined as merchandise for to customers.
n
5. The accounts payable subsidiary ledger represents a potential of cash.
6. The controlling account in the general ledger for the accounts payable subsidiary ledger is called
L
.
No e
7. The accounts payable subsidiary ledger would be recorded .
8.
a
The balance in the Accounts Payable controlling account should be equal to the sum of the accounts
t F rn
payable subsidiary ledger accounts
.
9.
or in
In perpetual inventory, purchases are recorded as .
Di g
10. The ⻬ in the reference column indicates that the
s O e R has been updated.

11. A(n)
tri r So
that is issued means the buyer owes less money, as
sa
merchandise is being returned or an allowance received.
12.
bu le lu
A debit memorandum issued or a credit memorandum received results in a(n)
Accounts Payable and a credit to Purchases, Returns and Allowances.
to
13. List price ⫺ net price =

tio t amount.
io
n
14. The accounts payable subsidiary ledger is listed in .
15.
16.
17.
Purchases Returns and Allowances is increased by a(n)
Cost of goods sold is classified as a(n)
In a perpetual inventory system, freight is recorded in the
.
.
n s
account.
18. Purchases Discounts is increased by .
19. A(n) provides the purchasing department the information to
then prepare a purchase order.
20. A(n) is made out after a company inspects received
shipments.
SG-339
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-340
Name __________________________________ Class ____________________ Date ____________________
Part II
Financial
Account Title CAT ↑↓ Statement
Pe
1. Purchases
2. Purchase Discount
ar
3. Accounts Receivable
4. Cost of Goods Sold
5.
so
Salary Expenses
n
6. Accounts Payable
7. Purchase Returns and Allowances
L
8. Cash
No e
9. Supplies
10. Sale Discount
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-340
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-341
Name __________________________________ Class ____________________ Date ____________________

1. F.O.B. shipping point means the seller is responsible to cover shipping costs.
2. The Purchases account is a contra-cost of goods sold account.
3. Purchases discounts are the result of paying for equipment within the discount period.
Pe
4. F.O.B. Destination means the seller is responsible to cover shipping costs.
5. Purchases discounts are taken on freight.
6. Merchandise inventory is an asset.
ar
7. Cost of goods sold is a cost.
so
8. The balance in Accounts Payable, the controlling account, will be equal to the sum of the accounts
receivable subsidiary ledger at the end of the month.
9. A purchase order is completed after the purchase requisition.
10.
n
On receiving a purchase order, the seller may issue a sales invoice.
L
11. The normal balance of Purchases Discount is a debit balance.
12.
No e
The seller will often issue a debit memorandum to the buyer.
13. Cost of goods sold is used in a periodic inventory system.
14.
15.
16.
a
Returned equipment by a buyer results in a change in Purchases Returns and Allowances.
t F rn
Trade discounts do not occur because of early payments of one’s bills.
or in
A seller’s sales discount on purchases is the buyer’s purchases discount.
17. Buying of equipment on account is only recorded in the general ledger.
Di g
18. On receiving a debit memorandum, the seller will issue a credit memorandum.
19.
s O e R
Returns in a perpetual accounting system are recorded in the merchandise inventory account.
So
20. Purchases are contra costs.
tri r sa
bu CHAPTER 10
le lu
Part I
tio t io
n n
1. perpetual, periodic 11. debit memorandum
s
2. contra-cost 12. debit
3. debit 13. trade discount
4. resale 14. alphabetical order
5. outflow 15. credit
6. accounts payable 16. cost
7. daily 17. merchandise inventory
8. at end of month 18. credits
9. merchandise inventory 19. purchase requisition
10. accounts payable subsidiary ledger 20. receiving report
SG-341
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-342
Name __________________________________ Class ____________________ Date ____________________
Part II
1. cost Dr Cr Income Statement
2. contra-cost Cr Dr Income Statement
3. asset Dr Cr Balance Sheet
4. cost Dr Cr Income Statement
5. expense Dr Cr Income Statement
Pe
6. liability
7. contra-cost
Cr
Cr
Dr
Dr
Balance Sheet
Income Statement
ar
so
10. contra-revenue Dr Cr Income Statement
n
Part III
No eL
a
1. false 11. false
t F rn
2. false 12. false
3. true 13. false
or in
4. true 14. true
5. false 15. true
6. true
Di R g 16. true
s O e So
7. true 17. false
8. false
tri r
18.
sa
true
bu le lu
9. true 19. true
10. true 20. false
tio t io
n n s
SG-342
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Name __________________________________ Class ____________________ Date ____________________

GENERAL JOURNAL
PAGE 5
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-343
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Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar
so
n
SUPPLIES ACCOUNT NO. 1030
Balance
L
Ref. Debit Credit
No e ⻬
a
2/1 0X Balance forward 1 3 2 00
t F rn
or in
MERCHANDISE INVENTORY ACCOUNT NO. 1040
Di g
Balance
R
s O e
Ref. Debit Credit
tri r sa So
bu le lu
tio t io
n n s
SG-344
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-345
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
so
Balance
Ref. Debit Credit

n ⻬ 2 0 5 0 00
No eL
a
t F rn PURCHASES ACCOUNT NO. 6000
or in
Balance
Di g
Ref. Debit Credit
s O e R
tri r sa So
bu le lu
PURCHASE RETURNS AND ALLOWANCES ACCOUNT NO. 6010
tio t
Balance
io
Ref. Debit Credit
n n
PURCHASE DISCOUNTS
s
ACCOUNT NO. 6020
Balance
Ref. Debit Credit
SG-345
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-346
Name __________________________________ Class ____________________ Date ____________________

2/28/0X
Pe
ar
so
n
L
NAME MULTI SYSTEMS, INC. # 6A3
No e
ADDRESS 1919 MORAN ST., ANAHEIM, CA 92606
a
t F rn
Ref.
or in
Di R g
NAME
s O e
OFFICE DEPOT
tri r sa So# 6A4
bu
ADDRESS 460 ESCONDIDO BLVD., ESCONDIDO, CA 92025

le lu
tio t
Ref.
n
⻬
io 5 0 00
n s
SG-346
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Name __________________________________ Class ____________________ Date ____________________
NAME SAN DIEGO ELECTRIC # 6A5

ADDRESS 606 INDUSTRIAL ST., SAN DIEGO, CA 92121

Ref.
Pe
ar
so
NAME PAC BELL # 6A6
n
ADDRESS 101 BELL AVE., SAN DIEGO, CA 92101
L
Ref.
No e
a
t F rn
or in
Di R g
s O e
NAME COMPUTER CONNECTION # 6A7
ADDRESS
tri r
1020 WIL LANE, LOS ANGELES, CA 92405
sa So
bu le lu
Ref.
tio t io
n n s
SG-347
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-348
Name __________________________________ Class ____________________ Date ____________________
NAME SYSTEM DESIGN FURNITURE # 6A8

ADDRESS 2070 FIRST ST., SAN DIEGO, CA 92101

Ref.
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-348
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Name __________________________________ Class ____________________ Date ____________________
APPENDIX 10A
FORMS FOR CLASSROOM DEMONSTRATION PROBLEM — SPECIAL JOURNALS
J. LING CO.
SALES JOURNAL
PAGE 1
Pe
Date Account Debited Terms Invoice No. Post Dr. Acc. Receivable
Ref. Cr. Sales
ar
so CASH RECEIPTS JOURNAL PAGE 1
n
Sundry
Sales Accounts
L
Date Cash Discounts Receivable Sales Account Amount
Dr. Dr. Cr. Cr. Name PR Cr.
No e
a
t F rn
or in
Di R g
s O e
PURCHASES JOURNAL PAGE 1
Date Account
tri Terms
r PR
Accounts
Payable
saPurchases
So Sundry Dr.
bu le lu
Credited Cr. Dr. Account PR Amount
tio t io
n n
Date Check Accounts Debited
CASH PAYMENTS JOURNAL
PR
Sundry
Account
Accounts
Payable
Purchases
Discounts
s PAGE 1
Cash
No. Dr. Dr. Cr. Cr.
SG-349
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-350
Name __________________________________ Class ____________________ Date ____________________
DEMONSTRATION PROBLEM (CONTINUED)
GENERAL JOURNAL
PAGE 1
Pe
ar
so
n
No eL
a
t F rn ACCOUNTS RECEIVABLE SUBSIDIARY LEDGER
or in
NAME BALDER CO.
Di g
ADDRESS 1 ROCK RD., DENVER, CO 66083
s O e R
So
tri r
Ref.
sa
bu le lu
tio t io
n n
NAME LEWIS CO.
ADDRESS 15 SMITH AVE., REVERE, MA 01545

Ref.
Debit Credit
s
Dr. Balance
SG-350
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-351
Name __________________________________ Class ____________________ Date ____________________
DEMONSTRATION PROBLEM (CONCLUDED)

NAME CASE CO.
ADDRESS 1 LONG RD., MARLBOROUGH, MA 01545
Pe
Ref.
ar
so
NAME NOONE CO.
ADDRESS
n
11 MILL RD., MALDEN, OK 01143
Date
No eL Explanation Post
Ref.
a
t F rn
or in
Di g
s O e R
So
Cash 111 Sales 410 Purchases Discounts 530
tri r sa
Accounts Receivable
bu 112
le lu
Sales Returns & Allowances 420 Salaries Expense 610
tio t io
Equipment 116
n Sales Discount 430
n
Accounts Payable 210 Purchases 510
s
Purchases Returns &
J. Ling, Capital 310 Allowances 520
SG-351
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-352
Name __________________________________ Class ____________________ Date ____________________
CHAPTER 10A APPENDIX FORMS

PROBLEM A-1
(1, 2)
FOOD.COM
SALES JOURNAL
Pe
PAGE 1
Accounts Pizza Grocery
ar
Date Account Debited Invoice Receivable Sales Sales
No. PR Dr. Cr. Cr.
so
n
No eL
a
t F rn
or in
Di R g
s O e
(1, 2)
tri r
FOOD.COM
GENERAL JOURNAL
sa So
bu le lu
PAGE 1
tio t
n io
n s
SG-352
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-353
Name __________________________________ Class ____________________ Date ____________________
PROBLEM A-1 (CONTINUED)

NAME DUNCAN CO.
ADDRESS 942 MOSE ST., REVERE, MA 01938
Pe Date Explanation Post

Ref.
ar
so
n
NAME
No eL
LONG CO.
a
ADDRESS 8 JOSS AVE., LYNN, MA 01947
Date
t F rn Explanation Post Debit Credit Dr. Balance
or in
Ref.
Di R g
s O e tri r sa So
NAME
bu
SUE MOORE CO.
le lu
tio t
ADDRESS 10 LOST RD., TOPSFIELD, MA 01998
n io
n
Ref.
SG-353
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-354
Name __________________________________ Class ____________________ Date ____________________
FOOD.COM
GENERAL LEDGER
Pe
Balance
Ref. Debit Credit
ar
so
n
PIZZA SALES ACCOUNT NO. 410
Balance
L
Ref. Debit Credit
No e
a
t F rn
or in
GROCERY SALES ACCOUNT NO. 411
Balance
Date
Di R
Explanation
g
Post Debit Credit
s O e
Ref. Debit Credit
tri r sa So
bu le lu
tio
t io
ACCOUNT NO. 412
n n
Balance
s
Ref. Debit Credit
SG-354
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-355
Name __________________________________ Class ____________________ Date ____________________
PROBLEM A-1 (CONCLUDED)
FOOD.COM
JUNE 30, 200X
Pe
ar
so
n
L
PROBLEM A-2
No e
(1, 2)
a
TED’S AUTO SUPPLY
t F rn
SALES JOURNAL
PAGE 4
or in
Customer’s Accounts Sales Tax Auto Parts
Di g
Date Name Invoice Receivable Payable Sales
R
Account Receivable No. PR Dr. Cr. Cr.
s O e tri r sa So
bu le lu
tio t io
n n s
SG-355
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-356
Name __________________________________ Class ____________________ Date ____________________

(1, 2)
TED’S AUTO SUPPLY
GENERAL JOURNAL
PAGE 2
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-356
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Name __________________________________ Class ____________________ Date ____________________

NAME LANCE CORNER
ADDRESS 9 ROE ST., BARTLETT, NH 01382
Pe Date
200X
Explanation Post
Ref.
ar
Nov 1 Balance ⻬ 4 0 0 00
so
n
No eL
a
NAME J. SETH
t F rn
ADDRESS 22 REESE ST., LACONIA, NH 04321
or in
200X Ref.
Nov 1
Di
Balance
R g ⻬ 2 0 0 00
s O e tri r sa So
bu le lu
tio t io
n
NAME R. VOLAN
n
ADDRESS 12 ASTER RD., MERRIMACK, NH 02134
Date
200X
Nov 1 Balance
Explanation Post
Ref.
⻬
Debit Credit
s
Dr. Balance
1 0 0 0 00
SG-357
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-358
Name __________________________________ Class ____________________ Date ____________________
TED’S AUTO SUPPLY

GENERAL JOURNAL
Pe
Balance
ar
Nov 1 Balance ⻬ 1 6 0 0 00
so
n
L
Balance
No e
Nov 1 Balance
a
t F rn
⻬ 1 6 0 0 00
or in
Di R g
AUTO PARTS SALES ACCOUNT NO. 410
Date
s O e tri
Explanation
r
Post
Ref.
Debit
sa So
Credit
Debit
Balance
Credit
bu le lu
tio t io
n n s
Balance
Ref. Debit Credit
SG-358
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-359
Name __________________________________ Class ____________________ Date ____________________
(3)
TED’S AUTO SUPPLY
NOVEMBER 30, 200X
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-359
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Name __________________________________ Class ____________________ Date ____________________
PROBLEM A-3
PAGE 3
Amount
Pe
Sundry Dr.
PR
ar
Account
so
n
L
Purchases
No e
Dr.
a
t F rn
PURCHASES JOURNAL
SKATES.COM
or in
Accounts
Payable
Cr.
Di R g
s O e tri r sa So
PR
bu le lu
Terms
tio t io
No.
Inv.
n n
Date of
Invoice
s
Credited
Account
Date
SG-360
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-361
Name __________________________________ Class ____________________ Date ____________________

NAME MAIL.COM
ADDRESS 12 SMITH ST., DEARBORN, MI 09113
Pe
Ref.
ar
so
NAME NORTON CO.
n
ADDRESS 1 RANTOUL RD., CHARLOTTE, NC 01114
Date
Ref.
a
t F rn
NAME
or in
ROLO CO.
ADDRESS
Di R g
2 WEST RD., LYNN, MA 01471
Date s O e tri r
Explanation
sa So
Post
Ref.
bu le lu
tio t io
n
n
Date Explanation
STORE SUPPLIES
Post Debit Credit

ACCOUNT NO. 115
s
Balance
Ref. Debit Credit
SG-361
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-362
Name __________________________________ Class ____________________ Date ____________________
STORE EQUIPMENT ACCOUNT NO. 121

Balance
Ref. Debit Credit
Pe
ar
so ACCOUNTS PAYABLE ACCOUNT NO. 210
n
Balance
L
Ref. Debit Credit
No e
a
t F rn
or in
Di R g
Balance
s O e
So
Ref. Debit Credit
tri r sa
bu le lu
tio t io
n n s
SG-362
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-363
Name __________________________________ Class ____________________ Date ____________________
PROBLEM A-4
Amount
PAGE 10
Sundry Dr.
Pe
PR
ar
Account
so
n Supplies
Store
Dr.
L
MABEL’S NATURAL FOOD STORE
No e
a
PURCHASES JOURNAL
Purchases
t F rn
Dr.
or in
Di g
Accounts
R
Payable
s O e
Cr.
tri r sa So
bu le lu
PR
tio t
No. Terms
n io
n
Inv.
s
Date of
Invoice
Credited
Account
Date
SG-363
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-364
Name __________________________________ Class ____________________ Date ____________________

NAME ATON CO.
ADDRESS 11 LYNNWAY AVE., NEWPORT, RI 03112
Pe
200X Ref.
ar
so
n
NAME BROWARD CO.
ADDRESS 21 RIVER ST., ANAHEIM, CA 43110
Date
No eL
Explanation Post Debit Credit Cr. Balance
a
200X Ref.
t F rn
or in
Di R g
s O e
NAME MIDDEN CO.
ADDRESS
tri r
10 ASTER RD., DUBUQUE, IA 80021
sa So
Date
200X
bu
Explanation Post
Ref.
le lu
tio t
⻬
io
May 1 Balance 1 2 0 0 00
n n s
NAME RELAR CO.
ADDRESS 22 GERALD RD., SMITH, CO 43138

200X Ref.
SG-364
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-365
Name __________________________________ Class ____________________ Date ____________________

Balance
Pe
Ref. Debit Credit
ar
so OFFICE EQUIPMENT ACCOUNT NO. 120
Balance
n
Ref. Debit Credit
No eL
a
t F rn ACCOUNTS PAYABLE ACCOUNT NO. 210
or in
Balance
Di g
s O e
May 1 Balance
R ⻬ 2 7 0 0 00
tri r sa So
bu le lu
tio t io
n n
PURCHASES ACCOUNT NO. 510s
Balance
May 1 Balance ⻬ 16 7 0 0 00
SG-365
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-366
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar
so
GENERAL JOURNAL PAGE 2
n
No eL
a
t F rn
or in
MABEL’S NATURAL FOOD STORE
Di g
MAY 31, 200X
s O e R
tri r sa So
bu le lu
tio t io
n n s
SG-366
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-367
Name __________________________________ Class ____________________ Date ____________________
PROBLEM A-5
(1, 3)
Amount
PAGE 1
Pe
Sundry Dr.
ar
PR
so
n Accounts
No eL
Purchases
a
Toy
Dr.
t F rn
PURCHASES JOURNAL
ABBY’S TOY HOUSE
or in
Accounts
Payable
Di g
Cr.
s O e R
tri r sa So
PR
bu le lu
Terms
tio t io
No.
Inv.
n ns
Date
Inv.
of
Credited
Account
Date
SG-367
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-368
Name __________________________________ Class ____________________ Date ____________________
PAGE 1
Amount
Cr.
Pe
PR
ar
so
Account
Sundry
n
No eL
a
t F rn
CASH RECEIPTS JOURNAL
Toy Sales
ABBY’S TOY HOUSE
Cr.
or in
Di R g
Receivable
s O e
Accounts
So
Cr.
tri r sa
bu le lu
tio t
Discounts
io
Sales
Dr.
n ns
Cash
Dr.Date
SG-368
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-369
Name __________________________________ Class ____________________ Date ____________________
PAGE 1
Cash
Cr.
Pe
ar
Purchases
Discount
Cr.
so
n
Accounts
Payable
L
Dr.
No e
a
ABBY’S TOY HOUSE
t F rn
Sundry
Dr.
or in
Di R g
PR
s O e tri r sa So
bu le lu
Account Debited
tio t io
n ns
Check
No. Date
SG-369
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-370
Name __________________________________ Class ____________________ Date ____________________

ABBY’S TOY HOUSE
SALES JOURNAL
MARCH 31, 200X
PAGE 1
Pe
Invoice Accounts Rec. – Dr.
Date Account Debited No. Terms PR Toy Sales – Cr.
ar
so
n
No eL
a
t F rn
or in
Di g
ABBY’S TOY HOUSE
R
GENERAL JOURNAL
s O e sa So
MARCH 31, 200X
tri r PAGE 1
bu le lu
tio t io
n n s
SG-370
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-371
Name __________________________________ Class ____________________ Date ____________________

(2) ACCOUNTS PAYABLE SUBSIDIARY LEDGER
NAME MINNIE KATZ
ADDRESS 87 GARFIELD AVE., REVERE, MA 01245
Pe
Ref.
ar
so
n
NAME SAM KATZ GARAGE
ADDRESS 22 REGIS RD., BOSTON, MA 01950
Date
Ref.
a
t F rn
or in
Di
NAME EARL MILLER CO.
ADDRESS
R g
22 RETTER ST., SAN DIEGO, CA 01211
s O e
Date
tri r
Explanation
sa
Post
Ref.
So
bu le lu
tio t io
n n
NAME
ADDRESS
WOODY SMITH
2 SPRING ST., WEERS, ND 02118
s
Ref.
SG-371
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-372
Name __________________________________ Class ____________________ Date ____________________

NAME BILL BURTON
ADDRESS 24 RYAN RD., BUIKE, OH 02183
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Ref.
ar
so
n
No eL
NAME
ADDRESS
BONNIE FLOW CO.
a
t F rn
2 SMITH RD., DALLAS, TX 22210
Date
or in
Di
Ref.
s O e R g
tri r sa So
NAME JIM REX bu le lu
ADDRESS
tio
1 SCHOOL ST., CLEVELAND, OH 22441
t io
Date Explanation
n Post Debit Credit
n
Dr. Balance
s
Ref.
SG-372
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-373
Name __________________________________ Class ____________________ Date ____________________
NAME AMY ROSE

ADDRESS 18 VEEK RD., CHESTER, CT 80111
Pe
Ref.
ar
so
n
GENERAL LEDGER
Date
No eL Explanation Post Debit Credit

Balance
a
Ref. Debit Credit
t F rn
or in
Di R g
s O e So
tri r sa
Balance
bu le lu
Ref. Debit Credit
tio t io
n n
Date
PREPAID RENT

ACCOUNT NO. 114
s
Balance
Ref. Debit Credit
SG-373
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-374
Name __________________________________ Class ____________________ Date ____________________
DELIVERY TRUCK ACCOUNT NO. 121

Balance
Ref. Debit Credit
Pe
ar
so
Balance
n
Ref. Debit Credit
No eL
a
t F rn
A. ELLEN, CAPITAL ACCOUNT NO. 310
Balance
or in
Ref. Debit Credit
Di R g
s O e tri r sa So
bu
TOY SALES
le lu
ACCOUNT NO. 410
tio t
Balance
io
Ref. Debit Credit
n n s
SG-374
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-375
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar
so
Balance
n
Ref. Debit Credit
No eL
a
t F rn
TOY PURCHASES ACCOUNT NO. 510
Balance
or in
Ref. Debit Credit
Di R g
s O e tri r sa So
bu le lu
t
tio io
Balance
n
n
Ref. Debit Credit
SG-375
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-376
Name __________________________________ Class ____________________ Date ____________________

Balance
Ref. Debit Credit
Pe
ar
so
Balance
n
Ref. Debit Credit
No eL
a
t F rn
CLEANING EXPENSE ACCOUNT NO. 612
Balance
or in
Ref. Debit Credit
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-376
65724_10_ch10_p298-377 4/15/09 11:51 AM Page SG-377
Name __________________________________ Class ____________________ Date ____________________
(4)
ABBY’S TOY HOUSE
MARCH 31, 200X
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ar
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L
(4)
No e
ABBY’S TOY HOUSE
a
MARCH 31, 200X
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
SG-377
63802_11_ch10B_p398-408 2/26/09 8:27 AM Page 398
398 CHAPTER 10
APPENDIX A
SPECIAL JOURNALS WITH PROBLEM MATERIAL
Pe
Classroom Demonstration Problem: Periodic Method
All credit sales are 2/10, n/30. All merchandise purchased on account has 3/10, n/30 credit
terms. Record the following transactions into special or general journals. Record and post
ar
as appropriate.
so
Solution Tips to Journalizing
200X
n
Mar. 1 J. Ling invested $2,000 into the business. CRJ
1 Sold merchandise on account to Balder Co., $500, invoice no. 1. SJ
L
2 Purchased merchandise on account from Case Co., $500. PJ
4 Sold $2,000 of merchandise for cash. CRJ
No e
6 Paid Case Co. from previous purchases on account, check no. 1. CPJ
a
8 Sold merchandise on account to Lewis Co., $1,000, invoice no. 2. SJ
t F rn
10 Received payment from Balder for invoice no. 1. CRJ
12 Issued a credit memorandum to Lewis Co. for $200 for faulty merchandise. GJ
14 Received payment from Lewis Co. CRJ
or in
16 Purchased merchandise on account from Noone Co., $1,000. PJ
17 Purchased equipment on account from Case Co., $300. PJ
Di R g
18 Issued a debit memorandum to Noone Co. for $500 for defective merchandise. GJ
s O e
20 Paid salaries, $300, check no. 2. CPJ
tri So
24 Paid Noone balance owed, check no. 3. CPJ
r sa
bu le lu
FIGURE A.1 Sales Journal
tio t io
J. LING, CO.
SALES JOURNAL
n n s
5 0 0 00
1 0 0 0 00
1 5 0 0 00
(112) (410)
63802_11_ch10B_p398-408 2/26/09 8:27 AM Page 399
APPENDIX A • SPECIAL JOURNALS WITH PROBLEM MATERIAL 399
FIGURE A.2 Purchases Journal
J. LING, CO.
PURCHASES JOURNAL
Pe 5 0 0 00 5 0 0 00
ar
1 0 0 0 00 1 0 0 0 00
3 0 0 00 3 0 0 00
1 8 0 0 00 1 5 0 0 00 3 0 0 00
so
(210) (510) (X)
n
No eL
a
FIGURE A.3 Cash Receipts Journal
t F rn
or in
Di R g
s O e tri
2 0 0 0 00
2 0 0 0 00
r sa
2 0 0 0 00
So 2 0 0 0 00
bu le lu
4 9 0 00 1 0 00 5 0 0 00
7 8 4 00 1 6 00 8 0 0 00
5 2 7 4 00 2 6 00 1 3 0 0 00 2 0 0 0 00 2 0 0 0 00
tio t
(111) (430) (112) (410) (X)
n io
n s
63802_11_ch10B_p398-408 2/26/09 8:27 AM Page 400
400 CHAPTER 10
FIGURE A.4 Cash

Payments Journal
J. LING, CO.
Pe 5 0 0 00 1 5 00 4 8 5 00
ar
3 0 0 00 3 0 0 00
5 0 0 00 1 5 00 4 8 5 00
3 0 0 00 1 0 0 0 00 3 0 00 1 2 7 0 00
so
(X) (210) (530) (111)
n
No eL
a
FIGURE A.5 General
t F rn
GENERAL JOURNAL
Journal
or in
2 0 0 00
Di
2 0 0 00
s O e R g
So
5 0 0 00
tri r sa
5 0 0 00
bu le lu
tio t io
n n s
63802_11_ch10B_p398-408 2/26/09 8:27 AM Page 401
FIGURE A.6 Subsidiary and

General Ledgers
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
63802_11_ch10B_p398-408 2/26/09 8:27 AM Page 402
402 CHAPTER 10
Summary of Solution Tips
Seller Buyer
Sales journal Purchases journal
Cash receipts journal Cash payments journal
Accounts receivable subsidiary ledger Accounts payable subsidiary ledger
Pe
Sales (Cr.) Purchases (Dr.)
Sales Returns and Allowances (Dr.) Purchase Returns and Allowances (Cr.)
Sales Discounts (Dr.) Purchase Discounts (Cr.)
ar
Accounts Receivable (Dr.) Accounts Payable (Cr.)
Issue a credit memo Receive a credit memo
so
or or
Receive a debit memo Issue a debit memo
n
Schedule of accounts receivable Schedule of accounts payable
L
A Step-by-Step Walk-Through of This Classroom
No e
Demonstration Problem
a
t F rn
Transaction
200X
What to Do Step-by-Step
or in
Mar. 1 Money Received: Record in cash receipts journal. Post immediately to J. Ling,
Capital, because it is in sundry.
1 Sale on Account: Record in sales journal. Record immediately to Balder Co. in
Di g
accounts receivable subsidiary ledger. Place a ✓ in Post. Ref. column of sales
R
journal when subsidiary is updated.
s O e So
2 Buy Merchandise on Account: Record in purchases journal. Record to Case Co.
tri r
immediately in the accounts payable subsidiary ledger.
4
sa
Money In: Record in cash receipts journal. No posting needed (put an × in Post.
bu
Ref. column).
le lu
6 Money Out: Record in cash payments journal. Save $15, which is a Purchases
Discount. Record immediately to Case Co. in accounts payable subsidiary
tio t
ledger (the full amount of $500).
io
8 Sales on Account: Record in sales journal. Update immediately to Lewis in
accounts receivable subsidiary ledger.
n n
10 Money In: Record in cash receipts journal. Because Balder pays within 10 days,
it gets a $10 discount. Record the full amount immediately to Balder in the
s
accounts receivable subsidiary ledger.
12 Returns: Record in general journal. Seller issues credit memo resulting in
higher sales returns and customers owing less. All postings and recordings are
done immediately.
14 Money In: Record in cash receipts journal:
$1,000 ⫺ $200 returns ⫽ $800
⫻ .02
$ 16 discount
Record immediately the $800 to Lewis in the accounts receivable subsidiary ledger.
16 Buy Now, Pay Later: Record in purchases journal. Record immediately to
Noone Co. in the accounts payable subsidiary ledger.
17 Buy Now, Pay Later: Record in purchases journal in Sundry. This item is not
merchandise for resale. Record and post immediately.
63802_11_ch10B_p398-408 2/26/09 8:27 AM Page 403
18 Returns: Record in general ledger. Buyer issues a debit memo reducing the Accounts
Payable due to purchases return and allowances. Post and record immediately.
20 Salaries: Record in cash payments journal, sundry column. Post immediately to
Salaries Expense.
24 Money Out: Record in cash payments journal. Save 3% ($15), a purchases dis-
count. Record immediately to accounts payable subsidiary ledger that you
reduce Noone by $500.
Pe
End of Month Post totals (except sundry) of special journal to the general ledger.
Note: In this problem at the end of the month, (1) Accounts Receivable in the general
ar
ledger, the controlling account, has a zero balance, as does each title in the accounts receiv-
able subsidiary ledger; and (2) the balance in Accounts Payable (the controlling account) is
so
$300. In the accounts payable subsidiary ledger, we owe Case $300. The sum of the
accounts payable subsidiary ledger does equal the balance in the controlling account at the
end of the month.
Appendix A Problems
n
L
A-1. Jill Blue opened Food.com, a wholesale grocery and pizza company. The fol-
lowing transactions occurred in June:
No e
a
200X
t F rn
June 1 Sold grocery merchandise to Duncan Co. on account, $500, invoice no. 1.
4 Sold pizza merchandise to Sue Moore Co. on account, $600, invoice no. 2.
8 Sold grocery merchandise to Long Co. on account, $700, invoice no. 3.
or in
10 Issued credit memorandum no. 1 to Duncan Co. for $150 of grocery merchandise
returned due to spoilage.
Di g
15 Sold pizza merchandise to Sue Moore Co. on account, $160, invoice no. 4.
19
s O e R
Sold grocery merchandise to Long Co. on account, $300, invoice no. 5.
So
25 Sold pizza merchandise to Duncan Co. on account, $1,200, invoice no. 6.
tri r sa
bu le lu
Required
1. Journalize the transactions in the appropriate journals.
2. Record to the accounts receivable subsidiary ledger and post to the general Check Figure: Schedule of
tio t
ledger as appropriate. accounts receivable $3,310
io
3. Prepare a schedule of accounts receivable.
n
A-2. The following transactions of Ted’s Auto Supply occurred in November (your
n
working papers have balances as of November 1 for certain general ledger
s
and accounts receivable ledger accounts):
200X
Nov. 1 Sold auto parts merchandise to R. Volan on account, $1,000, invoice no. 60, plus
5% sales tax.
5 Sold auto parts merchandise to J. Seth on account, $800, invoice no. 61, plus 5%
sales tax.
8 Sold auto parts merchandise to Lance Corner on account, $9,000, invoice no. 62,
plus 5% sales tax.
10 Issued credit memorandum no. 12 to R. Volan for $500 for defective auto parts mer-
chandise returned from Nov. 1 transaction. (Be careful to record the reduction in
Sales Tax Payable as well.)
12 Sold auto parts merchandise to J. Seth on account, $600, invoice no. 63, plus 5%
sales tax.
63802_11_ch10B_p398-408 2/26/09 8:27 AM Page 404
404 CHAPTER 10
Required
1. Journalize the transactions in the appropriate journals.
2. Record to the accounts receivable subsidiary ledger and post to the general
ledger as appropriate.
Check Figure: Schedule of
3. Prepare a schedule of accounts receivable.
accounts receivable $13,045
A-3. Abby Kim recently opened Skates.com. As the bookkeeper of her company,
Pe
please journalize, record, and post when appropriate the following transac-
tions (account numbers are Store Supplies, 115; Store Equipment, 121;
Accounts Payable, 210; Purchases, 510):
ar 200X
so
June 4 Bought $700 of merchandise on account from Mail.com, invoice no. 442, dated
June 5; terms 2/10, n/30.
Check Figure: Total of 5 Bought $4,000 of store equipment from Norton Co., invoice no. 502, dated
n
purchases column $2,100 June 6.
8 Bought $1,400 of merchandise on account from Rolo Co., invoice no. 401, dated
L
June 9; terms 2/10, n/30.
14 Bought $900 of store supplies on account from Mail.com, invoice no. 419, dated
No e
June 14.
a
t F rn
A-4. Mabel’s Natural Food Store uses a purchases journal and a general jour-
nal to record the following transactions (continued from April):
or in 200X
Di g
May 8 Purchased $600 of merchandise on account from Aton Co., invoice no. 400, dated
R
May 9; terms 2/10, n/60.
s O e So
10 Purchased $1,200 of merchandise on account from Broward Co., invoice no. 420,
tri r
dated May 11; terms 2/10, n/60.
12
sa
Purchased $500 of store supplies on account from Midden Co., invoice no. 510,
bu le lu
dated May 13.
Check Figure: Total schedule of
accounts payable $5,810 14 Issued debit memo no. 8 to Aton Co., for merchandise returned, $400, from
invoice no. 400.
tio t
17 Purchased $560 of office equipment on account from Relar Co., invoice no. 810,
io
dated May 18.
n
24 Purchased $650 of additional store supplies on account from Midden Co., invoice
n
no. 516, dated May 25; terms 2/10, n/30.
The food store decided to keep a separate column for the purchases of sup-
plies in the purchases journal. Your tasks are to
1. Journalize the transactions.
2. Post and record as appropriate.
s
3. Prepare a schedule of accounts payable.
A-5. Abby Ellen opened Abby’s Toy House. As her newly hired accountant, your
tasks are to
1. Journalize the transactions for the month of March.
2. Record to subsidiary ledgers and post to the general ledger as appropriate.
3. Total and rule the journals.
4. Prepare a schedule of accounts receivable and a schedule of accounts payable.
63802_11_ch10B_p398-408 2/26/09 8:27 AM Page 405
The following is the partial chart of accounts for Abby’s Toy House:
Abby’s Toy House Chart of Accounts
Assets Revenue
110 Cash 410 Toy Sales
112 Accounts Receivable 412 Sales Returns and Allowances Check Figures: Total of
schedule of accounts
Pe
114 Prepaid Rent 414 Sales Discounts receivable $7,600
121 Delivery Truck Cost of Goods Total of schedule of accounts
payable $9,000
Liabilities 510 Toy Purchases
ar
210 Accounts Payable 512 Purchases Returns and Allowances
Owner’s Equity 514 Purchases Discount
so
310 A. Ellen, Capital Expenses
610 Salaries Expense
612 Cleaning Expense
n
200X
Mar. 1
No eL
Abby Ellen invested $8,000 in the toy store.
a
1 Paid three months’ rent in advance, check no. 1, $3,000.
t F rn
1 Purchased merchandise from Earl Miller Company on account, $4,000, invoice no. 410,
dated March 2; terms 2/10, n/30.
3 Sold merchandise to Bill Burton on account, $1,000, invoice no. 1; terms 2/10, n/30.
or in
6 Sold merchandise to Jim Rex on account, $700, invoice no. 2; terms 2/10, n/30.
8 Purchased merchandise from Earl Miller Co. on account, $1,200, invoice no. 415,
Di g
9
s O e R
Sold merchandise to Bill Burton on account, $600, invoice no. 3; terms 2/10, n/30.
So
9 Paid cleaning service, check no. 2, $300.
tri r sa
10 Jim Rex returned merchandise that cost $300 to Abby’s Toy House. Abby issued
credit memorandum no. 1 to Jim Rex for $300.
bu le lu
10 Purchased merchandise from Minnie Katz on account, $4,000, invoice no. 311,
tio t
12 Paid Earl Miller Co. invoice no. 410, dated March 2, check no. 3.
io
13 Sold $1,300 of toy merchandise for cash.
13 Paid salaries, $600, check no. 4.
n n
14 Returned merchandise to Minnie Katz in the amount of $1,000. Abby’s Toy House
issued debit memorandum no. 1 to Minnie Katz.
s
15 Sold merchandise for $4,000 cash.
16 Received payment from Jim Rex, invoice no. 2 (less returned merchandise)
less discount.
16 Bill Burton paid invoice no. 1.
16 Sold toy merchandise to Amy Rose on account, $4,000, invoice no. 4;
terms 2/10, n/30.
20 Purchased delivery truck on account from Sam Katz Garage, $3,000, invoice no. 111,
dated March 21 (no discount).
22 Sold to Bill Burton merchandise on account, $900, invoice no. 5; terms 2/10, n/30.
23 Paid Minnie Katz balance owed, check no. 5.
24 Sold toy merchandise on account to Amy Rose, $1,100, invoice no. 6;
terms 2/10, n/30.
(continued on next page)

63802_11_ch10B_p398-408 2/26/09 8:27 AM Page 406
406 CHAPTER 10
25 Purchased toy merchandise, $600, check no. 6.

26 Purchased toy merchandise from Woody Smith on account, $4,800, invoice no. 211,
28 Bill Burton paid invoice no. 5, dated March 22.
28 Amy Rose paid invoice no. 6, dated March 24.
28 Abby invested an additional $5,000 in the business.
Pe
28 Purchased merchandise from Earl Miller Co., $1,400, invoice no. 436, dated
March 29; terms 2/10, n/30.
30 Paid Earl Miller Co. invoice no. 436, check no. 7.
ar
30 Sold merchandise to Bonnie Flow Company on account, $3,000, invoice no. 7;
terms 2/10, n/30.
so Sales and Cash Receipts Journal in a Perpetual

Accounting System for Art’s Wholesale Clothing
n
L
FIGURE A.7 A Sales Journal
ART’S WHOLESALE CLOTHING COMPANY
Under a Perpetual System
SALES JOURNAL
No e
a
t F rn
or in
8 0 0 00 5 6 0 00
1 6 0 0 00 1 1 2 0 00
Di g
2 0 0 0 00 1 4 0 0 00
R
5 0 0 00 3 5 0 00
s O e So
9 0 0 00 6 3 0 00
7 0 0 00 4 9 0 00
tri r sa 6 5 0 0 00 4 5 5 0 00
bu le lu
(113) (411) (510) (114)
tio t io
n n
What’s new:
In the journal: New columns for Cost of Goods Sold (Dr.) and Inventory (Cr.). Each
s
time a charge sale is earned, the Cost of Goods Sold increases and the amount of
Inventory at cost is reduced.
In the general ledger: New ledger accounts for Inventory and Cost of Goods Sold.
Example: On April 3, Art’s Wholesale sold Hal’s Clothing $800 of merchandise on
account. This sale cost Art’s $560 to bring this merchandise into the store.
63802_11_ch10B_p398-408 2/26/09 8:27 AM Page 407
FIGURE A.8 A Cash Receipts Journal Under a Perpetual System
ART’S WHOLESALE CLOTHING COMPANY

CASH RECEIPTS JOURNAL
Pe 8 0 0 0 00
7 8 4 00 1 6 00 8 0 0 00
8 0 0 0 00
ar
9 0 0 00 9 0 0 00 6 3 0 00
9 8 0 00 2 0 00 1 0 0 0 00
so
1 9 6 0 00 4 0 00 2 0 0 0 00
5 0 0 00 5 0 0 00
1 2 0 0 00 1 2 0 0 00 8 4 0 00
n
14 3 2 4 00 7 6 00 3 8 0 0 00 2 1 0 0 00 8 5 0 0 00 1 4 7 0 00
(111) (413) (113) (411) (X) (510) (114)
No eL
a
What’s new:
t F rn
In the journal: New columns for Cost of Goods Sold (Dr.) and Inventory (Cr.). Each
time a cash sale is earned, the Cost of Goods Sold increases and the amount of
or in
Inventory at cost is reduced.
Di R g
s O e tri r sa So
bu le lu
tio t io
n n s
63802_11_ch10B_p398-408 2/26/09 8:27 AM Page 408
Pe
ar
so
n
No eL
a
t F rn
or in
Di R g
s O e tri r sa So
bu le lu
tio t io
n ns

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65724_01_ch01_p001-023 4/15/09 11:49 AM Page SG-1

Name __________________________________ Class ____________________ Date ____________________

SELF-REVIEW QUIZ 1-2

Pe ASSETS LIABILITIES AND OWNER’S EQUITY

Accounts Cleaning Accounts B. Bing, B. Bing

Name __________________________________ Class ____________________ Date ____________________

SELF-REVIEW QUIZ 1-4

Name __________________________________ Class ____________________ Date ____________________

ASSETS LIABILITIES AND OWNER’S EQUITY

ASSETS = LIABILITIES + OWNER’S EQUITY

Cash + Receivable + Equipment = Payable + Capital – Withd. + Legal fees – Expenses

Name __________________________________ Class ____________________ Date ____________________

DEMONSTRATION PROBLEM (CONTINUED)

Name __________________________________ Class ____________________ Date ____________________

Name __________________________________ Class ____________________ Date ____________________

FORMS FOR EXERCISES

ar ASSETS = LIABILITIES + OWNER’S EQUITY

ASSETS LIABILITIES AND OWNER’S EQUITY

Name __________________________________ Class ____________________ Date ____________________

Name __________________________________ Class ____________________ Date ____________________

Name __________________________________ Class ____________________ Date ____________________

END OF CHAPTER PROBLEMS

PROBLEM 1A-1 OR PROBLEM 1B-1

Store Accounts Mia Annabelle,

s O e R g SEE’S INTERNET SERVICE

ASSETS = LIABILITIES + OWNER’S EQUITY

PROBLEM 1A-3 OR PROBLEM 1B-3

Name __________________________________ Class ____________________ Date ____________________

PROBLEM 1A-4 OR PROBLEM 1B-4

Name __________________________________ Class ____________________ Date ____________________

PROBLEM 1A-4 OR PROBLEM 1B-4 (CONCLUDED)

Pe ASSETS LIABILITIES AND OWNER’S EQUITY

Name __________________________________ Class ____________________ Date ____________________

PROBLEM 1A-5 OR PROBLEM 1B-5 (CONTINUED)

Name __________________________________ Class ____________________ Date ____________________

PROBLEM 1A-5 OR PROBLEM 1B-5 (CONCLUDED)

Name __________________________________ Class ____________________ Date ____________________

Name __________________________________ Class ____________________ Date ____________________

Part III Instructions

Name __________________________________ Class ____________________ Date ____________________

1. false 6. false 11. false

Computer Shop Office Accounts Freedman Freedman,

Name __________________________________ Class ____________________ Date ____________________

SANCHEZ COMPUTER CENTER

Name __________________________________ Class ____________________ Date ____________________

Name __________________________________ Class ____________________ Date ____________________

SELF-REVIEW QUIZ 2-3

Cash 111 Accounts Payable 211 Salon Fees 411

Name __________________________________ Class ____________________ Date ____________________

Name __________________________________ Class ____________________ Date ____________________

Name __________________________________ Class ____________________ Date ____________________

FORMS FOR DEMONSTRATION PROBLEM

Mel Free, Capital

Name __________________________________ Class ____________________ Date ____________________

FORMS FOR DEMONSTRATION PROBLEM (CONTINUED)

Name __________________________________ Class ____________________ Date ____________________

FORMS FOR DEMONSTRATION PROBLEM (CONCLUDED)

t F rn ASSETS LIABILITIES AND OWNER’S EQUITY

Name __________________________________ Class ____________________ Date ____________________

Name __________________________________ Class ____________________ Date ____________________

FORMS FOR EXERCISES

Name __________________________________ Class ____________________ Date ____________________

Name __________________________________ Class ____________________ Date ____________________

Name __________________________________ Class ____________________ Date ____________________

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date

Name ______________ Class Date