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Title: Problem 7-4BA
ACCOUNTS RECEIVABLE LEDGER
Ruth Blake
Date Explanation PR Debit Credit Balance
July 6 S3 7,500 7,500
Ashton Moore
Date Explanation PR Debit Credit Balance
July 13 S3 8,550 8,550
Kim Nettle
Date Explanation PR Debit Credit Balance
July 5 S3 19,200 19,200
Part 4
ACORN INDUSTRIES
Trial Balance
July 31
Debit Credit
Cash.....................................................................$353,137
Accounts receivable...........................................34,320
ACORN INDUSTRIES
Schedule of Accounts Receivable
July 31
Ruth Blake.............................................................$17,500
Part 5
Analysis component
To find the error(s), first re-add the account balances on the schedule of accounts receivable to confirm that the
addition is correct. Then, trace the balances listed on the schedule of accounts receivable back to the subsidiary
accounts to confirm that they are listed correctly on the schedule. Next, recalculate the balance of each subsidiary
account to confirm that the additions and subtractions are correct. Next, trace the postings from each subsidiary
account and from the controlling account back to the appropriate journals. Since the sales and cash receipts journals
were footed and crossfooted before posting, the previous steps should disclose the error.
Title: Problem 7-5BA
Parts 1 and 3
PURCHASES JOURNAL
Date Account
Date of
Invoice Terms PR
Accounts
Payable
Cr.
Purchases
Dr.
Office
Supplies
Dr.
Accounts
July 1 Teton Company.....................................6/30 2/10, n/30 6,500 6,500
7 Store Supp./Plaine Inc............................7/7 n/10, EOM 125/1,250
(201) (505) (124)
CASH DISBURSEMENTS JOURNAL
Date
Ck.
No. Payee Account Debited PR
Cash
Cr.
Purchases
Discounts
Cr.
Other
Accounts
Dr.
Accounts
Payable
July
3
300 The Weekly ...........................................Advertising Expense.............................................................
65
5
625 625
10 301 Teton Company.....................................Teton Company.....................................................................
6,370 130
(101) (507) ()
GENERAL JOURNAL Page 3
July 8 Accounts Payable—Plaine...........................201/250
Received a credit memorandum.
Parts 2 and 3
GENERAL LEDGER
Cash Acct. No. 101
Date Explanation PR Debit Credit Balance
Inventory Acct. No. 119
Date Explanation PR Debit Credit Balance
June 30 200,000
Office Supplies Acct. No. 124
Date Explanation PR Debit Credit Balance
Store Supplies Acct. No. 125
Date Explanation PR Debit Credit Balance
*
Store Equipment Acct. No. 165
Date Explanation PR Debit Credit Balance
July 9 P3 38,220 38,220
Accounts Payable Acct. No. 201
Date Explanation PR Debit Credit Balance
Long-Term Notes Payable Acct. No. 251
Date Explanation PR Debit Credit Balance
June 30 200,000
R. Acorn, Capital Acct. No. 301
Date Explanation PR Debit Credit Balance
Purchases Acct. No. 505
Date Explanation PR Debit Credit Balance
July 31 P3 23,470 23,470
Purchases Returns and Allowances Acct. No. 506
Date Explanation PR Debit Credit Balance
July 24 G3 2,400 2,400
Purchases Discounts Acct. No. 507
Date Explanation PR Debit Credit Balance
Sales Salaries Expense Acct. No. 621
Date Explanation PR Debit Credit Balance
Advertising Expense Acct. No. 655
Date Explanation PR Debit Credit Balance
July 3 D3 625 625
ACCOUNTS PAYABLE LEDGER
Charm’s Supply
Date Explanation PR Debit Credit Balance
Drake Company
Date Explanation PR Debit Credit Balance
Plaine, Inc.
Date Explanation PR Debit Credit Balance
July 7 P3 1,250 1,250
8 G3 250 1,000
Teton Company
Date Explanation PR Debit Credit Balance
Part 4
ACORN INDUSTRIES
Trial Balance
July 31
Debit Credit
Cash.....................................................................$ 24,601
Inventory.............................................................
200,000
Office supplies.................................................... 650
Long-term notes payable................................... 200,000
R. Acorn, Capital................................................. 100,000
23,470
ACORN INDUSTRIES
Schedule of Accounts Payable
July 31
Charm’s Supply...................................................$38,870
