Type
Solution Manual
Book Title
Financial Accounting Fundamentals 5th Edition
ISBN 13
978-0078025754

978-0078025754 Appendix E Solution Manual Part 1

March 26, 2020
Appendix E
Accounting with Special Journals
QUESTIONS
1. The five components of an accounting system are: source documents, input
devices, information processors, information storage, and output devices.
2. Source documents contain data about business transactions or events that are put
3. The five fundamental principles of accounting information systems are: (a) control
4. An input device is used to transfer data from source documents to the information
5. Data stored "off-line" are not immediately available to the information processor(s),
while "online" data are immediately available.
6. Output devices provide the means by which information is taken from the
accounting system and made available for use.
7. Four types of transactions usually recorded in special journals are: (a) sales on
credit, (b) purchases on credit, (c) cash receipts, and (d) cash disbursements.
8. The (a) initial and (b) page number of the journal from which the amount is posted is
entered in the Posting Reference column of the ledger account.
9. The double posting does not cause the trial balance to be out of balance because
10. When copies of the sales invoices are used as a sales journal, each invoice total is
posted to the proper customer account in the subsidiary Accounts Receivable
11. Both kinds of credits must not be placed in the same column because the sum of the
credits to the customer accounts must be posted to the Accounts Receivable
12. Immediate recording and posting of credit sales and cash receipts from customers
13. In its note 11 (Segment Information and Geographic Data), Apple discusses its
reportable segments; the Company manages its business primarily on a geographic
14. In its note 15 (Information about Segments and Geographic Areas), Google
discusses its reportable segments. The Company’s three reportable geographical
15.
Segment
Operating
Income
Net Sales
Operating Income /
Net Sales
Americas ..............................
$22,817
$62,739
36.4%
Europe ................................
13,025
37,883
34.4%
QUICK STUDIES
Quick Study E-1 (15 minutes)
A
Quick Study E-2 (10 minutes)
Quick Study E-3 (10 minutes)
a. Sales Journal
b. Purchases Journal
Quick Study E-4 (15 minutes)
General Journal
Nov. 2
[In Purchases Journal]
Quick Study E-5 (15 minutes)
a) Accounts Receivable Ledger
ACCOUNTS RECEIVABLE LEDGER
Stern Company
Accounts Receivable
Date
Explanation
PR
Debit
Credit
Balance
Quick Study E-6 (20 minutes)
PURCHASES JOURNAL
Date
Account
Date
of
Invoice
Terms
PR
Accounts
Payable
Cr.
Inventory
Dr.
Office
Supplies
Dr.
Other
Accounts
Dr.
Quick Study E-7 (10 minutes)
May 1
Purchases Journal
Quick Study E-8 (30 minutes)
Part 1
ACCOUNTS RECEIVABLE LEDGER
Eric Horner
Hong Jiang
July 8
11,100
July 14
20,500
Quick Study E-9 (15 minutes)
Product
Product Sales
Percent of Total Sales
iPhone ............................................
$ 91,279
53.4%
iPad ................................................
31,980
18.7
Quick Study E-10 (15 minutes)
General Journal
1.
[In Purchases Journal]
EXERCISES
Exercise E-1 (15 minutes)
SALES JOURNAL
Date
Account Debited
Invoice
Number
PR
Accounts
Receivable Dr.
Sales Cr.
Cost of Goods
Sold Dr.
Inventory Cr.
Exercise E-2 (10 minutes)
May 2
Cash Receipts Journal
5
Purchases Journal
Exercise E-3 (20 minutes)
CASH RECEIPTS JOURNAL
Date
Account Credited
Explanation
PR
Cash
Dr.
Sales
Discount
Dr.
Accounts
Recble.
Cr.
Sales
Cr.
Other
Accounts
Cr.
Cost of
Goods
Sold Dr.
Inventory Cr.
Nov. 9
Notes Payable ..................
Note to bank
3,750
3,750
Exercise E-4 (10 minutes)
November 3
Purchases Journal
7
Sales Journal
Cash Receipts Journal
Exercise E-5 (15 minutes)
a) Accounts Payable Ledger
ACCOUNTS PAYABLE LEDGER
Bailey Company
Date
Explanation
PR
Debit
Credit
Balance
Jan. 9
P1
14,000
14,000
19
D1
10,100
3,900
Johnson Brothers
Date
Explanation
PR
Debit
Credit
Balance
Exercise E-6 (25 minutes)
CASH DISBURSEMENTS JOURNAL
Date
Ck.
No.
Payee
Account
Debited
PR
Cash
Cr.
Inventory
Cr.
Other
Accounts
Dr.
Accounts
Payable
Dr.
Apr. 9
210
Kitt Corp. ................................
Store Supplies ................................
650
650
Exercise E-7 (10 minutes)
April 3
Purchases Journal
9
Cash Disbursements Journal
Exercise E-8 (10 minutes)
1. B When crossfooting the Purchases Journal.
Exercise E-9 (10 minutes)
a. (i) The June 5 purchase would be recorded in the Purchases Journal.
Exercise E-10 (30 minutes)
Part 1
ACCOUNTS RECEIVABLE SUBSIDIARY LEDGER
Anna Page
Sara Reed
Aaron Reckers
May 17
1,850
May 20
350
May 10
2,940
May 6
3,880
25
1,340
Part 2
GENERAL LEDGER
Accounts Receivable
Sales
Sales Returns and
Allowances
May 31
10,010
May 20
350
May 31
10,010
May 20
350
Part 3
MOUNTAIN VIEW
Schedule of Accounts Receivable
May 31
Anna Page .............................................
$ 1,500
Accounts Receivable Controlling Account
Exercise E-11 (20 minutes)
Segment Income
(in $ mil.)
Segment Assets
(in $ mil.)
Segment Return
on Assets
Segment
2015
2014
2015
2014
2015
Specialty
Skiing Group ..............
$ 72
$ 68
$ 591
$ 450
13.8%
General Merchandise
South America ...........
42
46
315
284
14.0%
Analysis and interpretation: This company shows solid profitability in all
segments based on segment return on assets.
©2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned,
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Solutions Manual, Appendix E
451
PROBLEM SET A
Problem E-1A (100 minutes)
Parts 1 and 2
SALES JOURNAL
Page 2
Date
Account Debited
Invoice
Number
PR
Accounts Receivable Dr.
Sales Cr.
Cost of Goods Sold Dr.
Inventory Cr.
Mar. 2
Min Cho .....................................................
854
16,800
8,400
3
Linda Witt ..................................................
855
10,200
5,800
10
Jovita Albany ................................
856
5,600
2,900
PURCHASES JOURNAL
Page 2
Date
Account
Date of
Invoice
Terms
PR
Accounts
Payable
Cr.
Inventory
Dr.
Office
Supplies
Dr.
Other
Accounts
Dr.
Mar. 1
Van Industries ................................
3/1
2/15, n/30
43,600
43,600
3
Gabel Company ................................
3/3
n/10, EOM
1,230
1,230
9
Office Equip./Spell Supply .........................
3/9
n/10, EOM
163/
21,850
21,850
Problem E-1A (Continued)
Parts 1 and 2continued
CASH RECEIPTS JOURNAL
Page 2
Date
Account Credited
Explanation
PR
Cash
Dr.
Sales
Discount
Dr.
Accounts
Receivable
Cr.
Sales
Cr.
Other
Accts.
Cr.
Cost of Goods
Sold Dr.
Inventory Cr.
Mar. 6
L.T. Notes Pay. ................................
Note to bank................................
251
82,000
82,000
12
Min Cho ................................
Invoice, 3/2 ................................
16,464
336
16,800
13
Linda Witt ................................
Invoice 3/3 ................................
9,996
204
10,200
CASH DISBURSEMENTS JOURNAL
Page 2
Date
Ck.
No.
Payee
Account Debited
PR
Cash
Cr.
Inventory
Cr.
Other
Accounts
Dr.
Accounts
Payable
Dr.
Mar. 13
416
Van Industries ................................
Van Industries ................................
42,728
872
43,600
15
417
Payroll ................................
Sales Salaries Expense ................................
621
18,300
18,300
Problem E-1A (Continued)
Parts 1 and 2continued
GENERAL JOURNAL
Page 2
Mar. 17
Accounts PayableCD Co. ................................
201/
2,425
Inventory ................................................................
119
2,425
Cash
Acct. No. 101
Date
Explanation
PR
Debit
Credit
Balance
Mar. 31
R2
178,808
178,808
31
D2
108,924
69,884
Accounts Receivable
Acct. No. 106
Mar. 1
10,000
17
G2
2,425
7,575
31
P2
76,225
83,800
31
D2
1,476
82,324
31
S2
27,600
54,724
Date
Explanation
PR
Debit
Credit
Balance
Mar. 16
P2
1,770
1,770

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