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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
Inventory
Cost of Goods Sold
May 31
8,000
May 31
8,000
Part 3
MOUNTAIN VIEW
Schedule of Accounts Receivable
May 31
Anna Page .............................................
$ 1,500
Sara Reed ..............................................
4,280
Aaron Reckers ................................
3,880
Total accounts receivable ....................
$ 9,660
Accounts Receivable Controlling Account
Total debit...................................................
$10,010
Credit for return ................................
(350)
Balance as of May 31 ................................
$ 9,660
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%
Skating Group ............
19
16
63
52
33.0%
Specialty Footwear .......
32
29
165
146
20.6%
Other Specialty ..........
21
14
47
34
51.9%
Subtotal ......................
144
127
866
682
General Merchandise
South America ...........
42
46
315
284
14.0%
United States ..............
17
18
62
45
31.8%
Europe ........................
15
13
24
22
65.2%
Subtotal ......................
74
77
401
351
Total ..............................
$218
$204
$1,267
$1,033
Analysis and interpretation: This company shows solid profitability in all
segments based on segment return on assets.
For the specialty segments, the “Other Specialty” has the highest segment
return on assets at 51.9% in 2015, whereas the skiing segment has the
lowest return on segment assets at 13.8%.
For the geographic segments, the highest segment return on assets is
produced by the European segment with 65.2% in 2015, whereas the South
American segment has the lowest return of 14.0%.
©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,
duplicated, forwarded, distributed, or posted on a website, in whole or part.
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
27
Jovita Albany ................................
857
14,910
7,220
28
Linda Witt ..................................................
858
4,315
3,280
31
Totals .........................................................
51,825
27,600
(106/413)
(502/119)
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
14
The CD Company ................................
3/13
2/10, n/30
32,625
32,625
16
Store Supplies/Gabel Company ...................
3/16
n/10, EOM
125/
1,770
_____
____
1,770
31
Totals ................................................................
101,075
76,225
1,230
23,620
(201)
(119)
(124)
()
©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,
duplicated, forwarded, distributed, or posted on a website, in whole or part.
Financial and Managerial Accounting, 6th Edition
452
Problem E-1A (Continued)
Parts 1 and 2—continued
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
15
Sales ................................
Cash sales ................................
34,680
34,680
20,210
20
Jovita Albany ................................
Invoice, 3/10 ................................
5,488
112
5,600
31
Sales ................................
Cash sales ................................
30,180
___
_____
30,180
_____
16,820
31
Totals ................................
178,808
652
32,600
64,860
82,000
37,030
(101)
(415)
(106)
(413)
()
(502/119)
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
23
418
The CD Co. ................................
The CD Company ................................
29,596
604
30,200
31
419
Payroll ................................
Sales Salaries Expense ................................
621
18,300
____
18,300
_____
31
Totals ................................
108,924
1,476
36,600
73,800
(101)
(119)
()
(201)
Problem E-1A (Continued)
Parts 1 and 2—continued
GENERAL JOURNAL
Page 2
Mar. 17
Accounts Payable—CD Co. ................................
201/
2,425
Inventory ................................................................
119
2,425
Received a credit memo for returns.
19
Accounts Payable—Spell Supply .............................
201/
630
Office Equipment ...................................................
163
630
Received a credit memo for returns.
GENERAL LEDGER
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
Date
Explanation
PR
Debit
Credit
Balance
Mar. 31
S2
51,825
51,825
31
R2
32,600
19,225
Inventory
Acct. No. 119
Date
Explanation
PR
Debit
Credit
Balance
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
31
R2
37,030
17,694
Problem E-1A (Continued)
Office Equipment
Acct. No. 163
Date
Explanation
PR
Debit
Credit
Balance
Mar. 9
P2
21,850
21,850
19
G2
630
21,220
Accounts Payable
Acct. No. 201
Date
Explanation
PR
Debit
Credit
Balance
Mar. 17
G2
2,425
(2,425)
19
G2
630
(3,055)
31
P2
101,075
98,020
31
D2
73,800
24,220
Long-Term Notes Payable
Acct. No. 251
Date
Explanation
PR
Debit
Credit
Balance
Mar. 6
R2
82,000
82,000
Common Stock
Acct. No. 307
Date
Explanation
PR
Debit
Credit
Balance
Mar. 1
3,000
Retained Earnings
Acct. No. 318
Date
Explanation
PR
Debit
Credit
Balance
Mar. 1
7,000
Problem E-1A (Continued)
ACCOUNTS RECEIVABLE LEDGER
Jovita Albany
Date
Explanation
PR
Debit
Credit
Balance
Mar. 10
S2
5,600
5,600
20
R2
5,600
0
27
S2
14,910
14,910
Min Cho
Date
Explanation
PR
Debit
Credit
Balance
Mar. 2
S2
16,800
16,800
12
R2
16,800
0
Linda Witt
Date
Explanation
PR
Debit
Credit
Balance
Mar. 3
S2
10,200
10,200
13
R2
10,200
0
28
S2
4,315
4,315
ACCOUNTS PAYABLE LEDGER
CD Company
Date
Explanation
PR
Debit
Credit
Balance
Mar. 14
P2
32,625
32,625
17
G2
2,425
30,200
23
D2
30,200
0
Gabel Company
Date
Explanation
PR
Debit
Credit
Balance
Mar. 3
P2
1,230
1,230
16
P2
1,770
3,000
Problem E-1A (Concluded)
Part 3
CHURCH COMPANY
Trial Balance
March 31
Debit
Credit
Cash ................................................................
$ 69,884
Accounts receivable ............................................
19,225
Inventory ...............................................................
17,694
Office supplies .....................................................
1,230
Store supplies ......................................................
1,770
Office equipment ..................................................
21,220
Accounts payable ................................................
$ 24,220
Long-term notes payable ................................
82,000
Common stock .....................................................
3,000
Retained earnings ................................................
7,000
Sales ................................................................
116,685
Sales discounts ....................................................
652
Cost of goods sold ..............................................
64,630
Sales salaries expense ................................
36,600
________
Totals ................................................................
$232,905
$232,905
CHURCH COMPANY
Schedule of Accounts Receivable
March 31
Jovita Albany ..........................................................
$14,910
Linda Witt ................................................................
4,315
Total accounts receivable ................................
$19,225
©McGraw-Hill Companies, 2015
Solutions Manual, Appendix E
457
Problem E-2A (70 minutes)
Parts 1, 2 and 3
SALES JOURNAL
Page 3
Date
Account Debited
Invoice
Number
PR
Accounts Receivable Dr.
Sales Cr.
Cost of Goods Sold Dr.
Inventory Cr.
Apr. 3
Page Alistair ................................
760
4,000
3,000
5
Paula Kohr ................................................
761
8,000
6,500
11
Nic Nelson .................................................
762
10,500
7,000
13
Page Alistair ................................
763
5,100
3,600
27
Paula Kohr ................................................
764
3,170
2,520
27
Nic Nelson .................................................
765
6,700
4,305
30
Totals .........................................................
37,470
26,925
(106/413)
(502/119)
CASH RECEIPTS JOURNAL
Page 3
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.
Apr.13
Page Alistair ................................
Sale of 4/3
3,920
80
4,000
14
Paula Kohr ................................
Sale of 4/5
7,840
160
8,000
16
Sales ................................
Cash Sales
52,840
52,840
35,880
18
L.T. Notes Payable ................................
Note to bank
251
60,000
60,000
20
Nic Nelson ................................
Sale of 4/11
10,290
210
10,500
23
Page Alistair ................................
Sale of 4/13
4,998
102
5,100
30
Sales ................................
Cash sales
73,975
___
_____
73,975
_____
58,900
30
Totals ................................
213,863
552
27,600
126,815
60,000
94,780
(101)
(415)
(106)
(413)
()
(502/119)
Problem E-2A (Continued)
Parts 2 and 3
GENERAL LEDGER
Cash
Acct. No. 101
Date
Explanation
PR
Debit
Credit
Balance
Mar. 31
85,000
Apr. 30
R3
213,863
298,863
