Type
Quiz
Book Title
Financial and Managerial Accounting: Information for Decisions 6th Edition
ISBN 13
978-0078025761

978-0078025761 App E Part 10

August 14, 2019
161. The following segment information is available for the three regions of the country in
which Fresh Snacks, Inc. does business (all amounts are in millions):
Midwest West South
Segment operating income…….. 120 380 75
Segment average assets……….. 310 782 103
a. Determine the segment return on assets for each geographic segment.
b. Comment on the results. How do the segments compare with respect to profitability?
162. Plimpton Sales uses special journals to record business transactions. Plimpton sells office
equipment. The company completed the following transactions a through j. Identify the
journal in which each transaction should be recorded.
a. Paid an installment on a bank loan.
b. Purchased inventory on credit.
c. Paid cash to a creditor.
d. Sold equipment to a customer on credit.
e. Sold equipment to a customer for cash.
f. Paid employees' salaries in cash.
g. Received payment from a customer on credit.
h. Purchased office supplies on account.
i.
Returned inventory to creditor before
payment.
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j. Sold equipment on account.
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McGraw-Hill Education.
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163. Jamison Company uses special journals to record transactions. All of the companies
listed below supply inventory to Jamison except McGarry Co. that supplies equipment. Use
the purchases journal given below to answer the following questions:
a. Foot and crossfoot the journal for accuracy.
Purchases Journal
Date Account Date of
Invoice Terms PR
Accounts
Payable
Cr.
Inventory
Dr.
Office
Supplies
Dr.
Other
Accounts
Dr.
5/3 Jones Co. 5/2 2/10, n/30 20,000 20,000
5/5 Perry Co. 5/4 2/10, n/30 18,000 18,000
5/7 McGarry Co./Equip. 5/6 n/60 36,000 36,000
5/8 Colder Co. 5/7 2/10, n/30 10,000
5/9 French Co. 5/8 2/10, n/30 12,000 12,000
b. An error was made in the journal. Identify the error and indicate how to correct it.
c. When Jamison compares the general ledger Accounts Payable account to the Accounts
Payable ledger, it notices that the general ledger control account is $10,000 more than the
schedule of Accounts Payable. What is the most likely cause and how should it be corrected?
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McGraw-Hill Education.
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164. Morris Company uses special journals to record transactions. Below are the sales journal
and cash receipts journal for Morris. Prepare the following:
a. Open an accounts receivable subsidiary ledger having a T-account for each customer. Post
the invoices to the subsidiary ledger.
b. Open an Accounts Receivable controlling T-Account. Post the end-of the month totals that
affect the Accounts Receivable account only.
c. Prepare a schedule of accounts receivable and prove that its total equals the Accounts
Receivable controlling account balance.
Sales Journal
Date Account Debited
Invoice
Number PR
Accounts Receivable Dr.
Sales Cr.
Cost of Goods Sold Dr.
Inventory Cr.
12/1 Wazoo Co. 1200 6,900 3,500
12/1 Fargo Co. 1201 3,400 1,800
12/3 Jansen Co. 1202 7,200 4,000
12/6 Marsh Co. 1203 3,000 1,500
Totals 20,500 10,800
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McGraw-Hill Education.
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Cash Receipts Journal
Date Account Credited Explanation PR
Cash
Dr.
Sales
Discount
Dr.
Accounts
Receivable
Cr.
Sales
Cr.
Other
Accounts
Cr.
Cost of Goods
Sold Dr.
Inventory Cr.
12/2
Sales
Cash sales
12,000
12,000
6,500
12/3
Notes Payable
Bank loan
15,000
15,000
12/5
Wazoo Co.
Invoice 12/1
6,762
138
6,900
12/6
Fargo Co.
Invoice 12/1
3,332
68
3,400
Totals
37,094
206
10,300
12,000
15,000
6,500
a.
Wazoo Fargo Jansen Marsh
6,900 6,900 3,400 3,400 7,200 3,000
0 0 7,200 3,000
b.
Accounts
Receivable
20,500 10,30
0
10,200
c.
Morris Company
Schedule of Accounts Receivable
December 6
Jansen Co. $7,200
Marsh Co. 3,000
Total accounts receivable $10,200
Blooms: Apply
AACSB: Analytic
AICPA BB: Industry
AICPA FN: Measurement
Difficulty: 3 Hard
Learning Objective: E-P2
Topic: Proving the Ledgers
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McGraw-Hill Education.
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165. Fagin Company uses special journals to record transactions. Below are the sales journal
and cash receipts journal for Fagin in the first part of August.
Required:
a. Open an accounts receivable subsidiary ledger having a T-account for each customer. Post
the invoices to the subsidiary ledger.
b. Open an Accounts Receivable controlling T-Account. Post the end-of the month totals that
affect the Accounts Receivable account only.
c. Prepare a schedule of accounts receivable and prove that its total equals the Accounts
Receivable controlling account balance.
Sales Journal
Date
Account
Debited Invoice No. PR
Accounts Receivable
Dr. Sales Cr.
Cost of Goods Sold Dr.
Inventory Cr.
8/1 Pip Co. 1200 6,900 3,000
8/1 Rivers Co. 1201 4,200 1,900
8/3 Lloyd Co. 1202 7,200 4,000
8/6 Carmen Co. 1203 2,500 1,200
Totals 20,800 10,100
Cash Receipts Journal
Date
Account
Credited Explanation PR Cash Dr.
Sales
Discount
Dr.
Accounts
Receivabl
e Cr. Sales Cr.
Other
Accounts
Cr.
Cost of
Goods
Sold Dr.
Inventory
8/2 Sales Cash sales 10,000 10,000 5,500
8/3 Notes
Payable
Bank loan 12,000 12,000
8/5 Pip Co. Invoice 8/1 6,762 138 6,900
8/9 Lloyd Co. Invoice 8/3 7,056 144 7,200
Totals 35,818 282 14,100 10,000 12,000 6,500
a.
Carmen Lloyd Pip Rivers
2,500 7,200 7,200 6,900 6,900 4,200
2,500 0 0 4,200
b.
Accounts
Receivable
20,800 14,10
0
6,700
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McGraw-Hill Education.
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McGraw-Hill Education.
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c.
Fagin Company
Schedule of Accounts Receivable
August 9
Carmen Co. $2,500
Rivers Co. 4,200
Total accounts receivable $6,700
Blooms: Apply
AACSB: Analytic
AICPA BB: Industry
AICPA FN: Measurement
Difficulty: 3 Hard
Learning Objective: E-P2
Topic: Proving the Ledgers
166. Valley Company shows the following customer accounts in its subsidiary ledger and the
Accounts Receivable account in the general ledger for the month of July. Prepare a schedule
of accounts receivable as proof that the subsidiary ledger balances equals the Accounts
Receivable controlling account balance.
Laredo Spring Dallas Preston
2,500 1,200 5,650 5,650 3,950 1,950 7,200
1,300 0 2,000 7,200
Accounts
Receivable
19,300 8,800
10,500
167. HealthCo Company uses special journals to record transactions. HealthCo uses the
perpetual inventory system. Journalize the following transactions in the appropriate special
journal. All credit sales have 2/10, n/30 terms.
Nov. 3 The company purchased $5,500 of merchandise on credit from Hatch, terms 2/10,
n/30.
5 The company sold merchandise costing $5,250 to Level Company for $8,900,
invoice no. 278.
7 The owner, L. Garvey, contributed $15,000 cash to the company.
8 The company purchased $7,200 of merchandise on credit from Gentry Company,
terms 1/15, n/30.
10 The company sold merchandise costing $4,630 to Nance Company for $8,250,
invoice no. 279.
14 The company received payment from Level Company for the November 5 sale
within the discount period.
15 HealthCo paid salaries of $5,560 for the first half of the month, check no. 214.
16 HealthCo returned $1,200 of the merchandise purchased on November 8 to Gentry
Company.
20 HealthCo paid Gentry for the purchase on November 8 within the discount period,
check no. 215.
22 HealthCo purchased office equipment from Vale Co. costing $12,000 on credit,
terms n/30.
Sales Journal
Date Account Debited
Invoice
Number PR
Accounts Receivable
Dr. Sales Cr.
Cost of Goods Sold Dr.
Inventory Cr.
Purchases Journal
Date Account
Date of
Invoice Terms PR
Accounts
Payable
Cr.
Inventory
Dr.
Office
Supplies
Dr.
Other
Accounts
Dr.
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McGraw-Hill Education.
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Cash Receipts Journal
Dat
e
Account
Credited
Explanation
PR
Cash
Dr.
Sales
Discount
Dr.
Accounts
Receivable
Cr. Sales Cr.
Other
Accounts
Cr.
Cost of
Goods Sold
Dr.
Inventory
Cr.
Cash Disbursements Journal
Date
Ck. No.
Payee Account Debited PR Cash Cr.
Inventory
Cr.
Other
Accounts
Dr.
Accounts
Payable
Dr.
General Journal

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