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Exam 17: Specimen Financial Statements: Amazoncom, Inc

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Question 41

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Easton Company began business on October 1. The sales journal, as it appeared at the end of the month, follows: 1. Open general ledger T-accounts for Accounts Receivable (No. 112) and Sales (No. 401) and an accounts receivable subsidiary T-account ledger with an account for each customer. Make the appropriate postings from the sales journal. Fill in the appropriate posting references in the sales journal above. 2. Prove the accounts receivable subsidiary ledger by preparing a schedule of accounts receivable.

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Question 42

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Cash from sales of merchandise will be recorded in the

A) purchases journal.
B) sales journal.
C) cash receipts journal.
D) general journal.

E) C) and D)
F) A) and C)

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Question 43

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Which of the following is not a special journal?

Circle the correct answer to each situation.

Postings are made daily to subsidiary ledgers so that

A company uses a sales journal, cash receipts journal, purchases journal, cash payments journal, and a general journal. A cash sales return would be recorded in the

The reference column in a sales journal is used to indicate the general ledger account number when the entry is posted.

If a certain type of transaction occurs with great frequency, it is more efficient to create a ______________ to record that type of transaction.

After Artie Company had completed all posting for the month of December, the sum of the balances in the following accounts payable subsidiary ledger did not agree with the balance of the control account in the general ledger. Name Aston's Address 286 Buck Avenue ------------------------------------------ Date Item Post. Ref. Debit Credit Balance ------------------------------------------ Dec. 2 P25 2,400 2,400 Name Carson Company Address 818 Western Avenue ------------------------------------------ Date Item Post. Ref. Debit Credit Balance ------------------------------------------ Dec. 1 Balance 7,600 10 CP23 7,600 - 20 P32 3,300 3,300 29 J15 300 3,600 Name Diana Fenn Company Address 90210 Baker Boulevard ------------------------------------------ Date Item Post. Ref. Debit Credit Balance ------------------------------------------ Dec. 1 Balance 9,900 18 CP28 9,900 - 29 P34 12,600 2,700 Name Maria Lopez Address 2720 Sommers Avenue ------------------------------------------ Date Item Post. Ref. Debit Credit Balance ------------------------------------------ Dec. 8 P27 6,000 6,000 27 P33 8,000 14,000 Name Oster Supplies Address 1560 Puckett Street ------------------------------------------ Date Item Post. Ref. Debit Credit Balance ------------------------------------------ Dec. 1 Balance 8,200 7 P26 5,600 13,800 12 J11 420 12,380 20 CP29 8,000 20,380 The balance in the Accounts Payable control account of $37,380 has been verified as correct. Also assume that the journals references in the Post Ref. columns of the accounts payable subsidiary ledger have been verified as correct. Instructions Determine the errors in the preceding accounts payable subsidiary accounts and prepare a corrected schedule of accounts payable.

Transactions that cannot be entered in a special journal are recorded in the _______________, and if control and subsidiary accounts are involved, there must be a _______________ posting.

The reference column of the accounts in the accounts payable subsidiary ledger after posting may show

Below are some typical transactions incurred by Harley Company. 1. Purchase of merchandise on account. 2. Collection on account from customers. 3. Payment of employee's wages. 4. Sales of merchandise for cash. 5. Close Income Summary to Retained Earnings. 6. Adjusting entry for depreciation on machinery. 7. Payment of creditors on account. 8. Purchase of office equipment on credit. 9. Sales discount taken on goods sold on credit. 10. Sales of merchandise on account. 11. Purchase of a delivery truck for cash. 12. Return of merchandise purchased on credit. 13. Payment of rent in advance. 14. Adjusting entry for accrued interest expense. 15. Purchase of office supplies for cash. For each transaction, indicate by the code letter the appropriate journal where the transaction would be journalized. CR - Cash Receipts Journal CP - Cash Payments Journal S - Sales Journal P - Single-Column Purchases Journal G - General Journal

Gates Company maintains four special journals and a general journal to record its transactions. Using the code below, indicate in the space provided the appropriate journal for recording the transactions listed. Code Journals S Sales journal CR Cash receipts journal CP Cash payments journal P Single-column purchases journal G General journal 1. Stockholders invested cash in the business. 2. Purchased store supplies on account. 3. Sold merchandise to customer on account. 4. Purchased a 2-year fire insurance policy for cash. 5. Received a check from a customer as payment on account. 6. Paid for store supplies purchased in transaction 2. 7. Purchased merchandise on account. 8. Issued a credit memorandum to a customer who returned defective merchandise previously sold on account. 9. Purchased office equipment for cash. 10. Made an adjusting entry for store supplies used during the period.

A subsidiary ledger is a group of control accounts which provides information to the managers for controlling the operation of the company.

Entries in the cash payments journal are made from

The entries in a sales journal will show

If merchandise from a cash sale is returned by a customer for a refund, the sales return is recorded in the

Using the cash payments journal above, identify each of the posting references indicated by a letter, as representing: (1) a posting to a general ledger account. (2) a posting to a subsidiary ledger account. (3) that no posting is required.

The use of special journals often saves time in the _______________ process.

A company would not likely use subsidiary ledgers for