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98
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.
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?
99
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.
101
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.
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
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.
167)
Health Co. Company uses special journals to record transactions. Health Co. uses the perpetual
inventory system. Journalize the following transactions in the appropriate special journal. All credit
sales have 2/10, n/30 terms.
103
104
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
Health Co. paid salaries of $5,560 for the first half of the month, check no.
214.
16
Health Co. returned $1,200 of the merchandise purchased on November 8
to Gentry Company.
20
Health Co. paid Gentry for the purchase on November 8 within the
discount period, check no. 215.
22
Health Co. purchased office equipment from Vale Co. costing $12,000 on
credit, terms n/30.
168)
The following information is available for Napa, Inc. (all amounts are in millions):
U.S.
Canada.
Europe
Segment sales
$7,745
$8,940
$4,780
Segment operating income
2,320
2,455
595
Segment average assets
5,590
8,750
1,480
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?
SHORT ANSWER QUESTIONS
169)
The ________ principle requires that the benefits from an activity in an accounting information
system outweigh the costs of that activity.
170)
The ________ principle requires that an accounting information system aid managers in controlling
and monitoring business activities.
171)
consist of people, records, methods, and equipment that collect and process data from
transactions and events, organize them in useful reports and communicate results to decision
makers.
172)
The ________ principle requires that an accounting information system report useful,
understandable, timely, and pertinent information for effective decision making.
173)
The ________ principle requires that an accounting information system conforms with a company's
activities, personnel, and structure, and must adapt to a company's unique characteristics.
174)
The ________ principle requires that an accounting information system must be able to adapt to
changes in the company, business environment, and needs of decision makers.
175)
________ provide the basic information processed by an accounting system, and can include bank
statements, billings to customers, and employee earnings records.
176)
capture information from source documents and enable its transfer to the system's
information processing component.
177)
are the part of the accounting information system that interprets, transforms, and
summarizes information for use in analysis and reporting.
178)
________ is the accounting system component that keeps data in a form accessible to information
processors.
179)
are the part of the accounting information system that provide the means to take
information out of the system and make it available to users.
180)
A ________ journal is used to record and post transactions of similar type.
181)
A is an all-purpose journal that can record any type of transaction.
182)
Using ________ ledgers, that store transaction data of individual accounts with common
characteristics, removes unnecessary details from the general ledger.
183)
refers to the programs that help managers direct a company's vital operations.
184)
processing of transactions enters and processes data as soon as source documents are
available.
185)
________ processing of transactions accumulates source documents for a period of time and then
processes them all at once such as daily, weekly, or monthly.
186)
are links among computers giving different users and different computers access to
common databases and programs.
187)
A ________ is a part of a company that is separately identified by its products, or services, or by
the geographic market it serves.
188)
The ________ ratio is a measure of a segment's profitability and is calculated as segment operating
income divided by segment average assets.
189)
Individual transactions in the sales journal are posted regularly to customers' accounts in the
________.
190)
A ________ is a listing of accounts from the accounts payable ledger with their balances and the
sum of all balances.
191)
The difference in the sales journal between the perpetual and periodic inventory systems is a
column to record ________ and ________ for each sale. This column is used in the perpetual
system but not in the periodic.
