CHAPTER 5 Accounting for Merchandising Businesses
Appendix Prob. 5–9B (Concluded)
2.
Apr. 2 Purchases 32,000
Freight In 330
Accounts Payable—Swan Company 32,330
8 Purchases 49,500
5-61
CHAPTER 5 Accounting for Merchandising Businesses
Appendix Prob. 5–10B
1. Periodic inventory system. Simkins Company uses a periodic inventory
2. See page 5-63.
5-62
CHAPTER 5 Accounting for Merchandising Businesses
Appendix Prob. 5–10B (Continued)
2.
Revenue from sales:
Add freight in 45,000
Cost of merchandise purchased 4,100,000
Cost of merchandise available for sale $4,515,000
Less merchandise inventory, June 30, 2014 508,000
Cost of merchandise sold 4,007,000
Office salaries expense $ 375,000
Rent expense 43,000
Insurance expense 17,000
Office supplies expense 5,000
Depreciation expense—office equipment 4,000
SIMKINS COMPANY
Income Statement
For the Year Ended June 30, 2014
5-63
CHAPTER 5 Accounting for Merchandising Businesses
Appendix Prob. 5–10B (Concluded)
3.
Merchandise Inventory 508,000
Sales 6,748,000
Purchases Returns and Allowances 32,000
Purchases Discounts 13,000
Closing Entries
5-64
CHAPTER 5 Accounting for Merchandising Businesses
1., 2., 6., and 9.
Account No. 110
Post.
Item Ref. Debit Credit Debit Credit
2014
21 21 2,300
21 21 42,900
26 21 7,500
28 21 85,000
Account No. 112
Post.
Item Ref. Debit Credit Debit Credit
2014
20 21 110,000
21 21 2,300
21 21 42,900
30 21 78,750
Date
Date
Balance
Cash
Account:
COMPREHENSIVE PROBLEM 2
Account: Accounts Receivable
Balance
5-65
CHAPTER 5 Accounting for Merchandising Businesses
Comp. Problem 2 (Continued)
Account No. 115
Post.
Item Ref. Debit Credit Debit Credit
2014
20 21 70,000
21 21 88,000
24 21 5,000
Account No. 116
Post.
Item Ref. Debit Credit Debit Credit
2014
Account No. 117
Post.
Item Ref. Debit Credit Debit Credit
2014
Account No. 123
Post.
Item Ref. Debit Credit Debit Credit
2014
Account: Merchandise Inventory
Balance
Date
Balance
Date
Account: Store Equipment
Account: Prepaid Insurance
Balance
Date
Account: Store Supplies
Balance
Date
5-66
CHAPTER 5 Accounting for Merchandising Businesses
Comp. Problem 2 (Continued)
Account No. 124
Post.
Item Ref. Debit Credit Debit Credit
2014
Account No. 210
Post.
Item Ref. Debit Credit Debit Credit
2014
May 1 Balance 996,600
3 20 36,000
Account No. 211
Post.
Item Ref. Debit Credit Debit Credit
2014
Account No. 310
Post.
Item Ref. Debit Credit Debit Credit
2014
Account No. 311
Post.
Item Ref. Debit Credit Debit Credit
2013
June 1 Balance 9585,300
Account: Salaries Payable
Balance
Date
Account: Retained Earnings
Balance
Date
Account: Accumulated Depreciation—Store Equipment
Balance
Date
Account: Accounts Payable
Balance
Date
Account: Capital Stock
Balance
Date
5-67
CHAPTER 5 Accounting for Merchandising Businesses
Comp. Problem 2 (Continued)
Account No. 312
Post.
Item Ref. Debit Credit Debit Credit
2014
Account No. 313
Post.
Item Ref. Debit Credit Debit Credit
2014
Account No. 410
Post.
Item Ref. Debit Credit Debit Credit
2014
May 1 Balance 95,221,100
Account No. 411
Post.
Item Ref. Debit Credit Debit Credit
2014
Account No. 412
Post.
Item Ref. Debit Credit Debit Credit
2014
May 1 Balance 959,400
Balance
Date
Account: Dividends
Account: Income Summary
Balance
Date
Account: Sales
Account: Sales Discounts
Balance
Date
Balance
Date
Date
Balance
Sales Returns and Allowances
Account:
5-68
CHAPTER 5 Accounting for Merchandising Businesses
Comp. Problem 2 (Continued)
Account No. 510
Post.
Item Ref. Debit Credit Debit Credit
2014
May 1 Balance 92,823,000
Account No. 520
Post.
Item Ref. Debit Credit Debit Credit
2014
May 1 Balance 9664,800
Account No. 521
Post.
Item Ref. Debit Credit Debit Credit
2014
May 1 Balance 9281,000
Account No. 522
Post.
Item Ref. Debit Credit Debit Credit
2014
Account: Cost of Merchandise Sold
Balance
Date
Account: Sales Salaries Expense
Account: Depreciation Expense
Balance
Date
Balance
Date
Account: Advertising Expense
Balance
Date
5-69
CHAPTER 5 Accounting for Merchandising Businesses
Comp. Problem 2 (Continued)
Account No. 523
Post.
Item Ref. Debit Credit Debit Credit
2014
Account No. 529
Post.
Item Ref. Debit Credit Debit Credit
Account No. 530
Post.
Item Ref. Debit Credit Debit Credit
2014
May 1 Balance 9382,100
Account No. 531
Post.
Item Ref. Debit Credit Debit Credit
2014
Account No. 532
Post.
Item Ref. Debit Credit Debit Credit
2014
May 31 Adjusting 22 12,000 12,000
Account: Stores Supplies Expense
Balance
Date
Account: Miscellaneous Selling Expense
Balance
Date
Account: Office Salaries Expense
Balance
Date
Balance
Date
Account: Rent Expense
Balance
Date
Account: Insurance Expense
5-70
CHAPTER 5 Accounting for Merchandising Businesses
Comp. Problem 2 (Continued)
Account No. 539
Post.
Item Ref. Debit Credit Debit Credit
2014
Account: Miscellaneous Administrative Expense
Balance
Date
5-71
CHAPTER 5 Accounting for Merchandising Businesses
Comp. Problem 2 (Continued)
1. and 2. Page 20
Post.
Ref. Debit Credit
2014
May 1 Rent Expense 531 5,000
Accounts Receivable—Halstad Co. 112 22,300
10 Cash 110 54,000
Sales 410 54,000
10 Cost of Merchandise Sold 510 32,000
Merchandise Inventory 115 32,000
Sales Discounts 412 1,100
Accounts Receivable—Korman Co. 112 55,000
19 Merchandise Inventory 115 18,700
Cash 110 18,700
19 Accounts Payable—Buttons Co. 210 33,450
Date
JOURNAL
5-72
CHAPTER 5 Accounting for Merchandising Businesses
Comp. Problem 2 (Continued)
Page 21
Post.
Ref. Debit Credit
2014
May 20 Accounts Receivable—Crescent Co. 112 110,000
21 Merchandise Inventory 115 88,000
Accounts Payable—Osterman Co. 210 88,000
24 Accounts Payable—Osterman Co. 210 5,000
Merchandise Inventory 115 5,000
26 Sales Returns and Allowances 411 7,500
30 Cost of Merchandise Sold 510 47,000
Merchandise Inventory 115 47,000
30 Cash 110 111,200
Sales Discounts 412 1,100
Accounts Receivable—Crescent Co. 112 112,300
Date
JOURNAL
5-73