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CHAPTER 5 Accounting Systems
Ex. 5–22 (Concluded)
c. Controlling accounts are not posted at the end of the month in a computerized
accounting system. Transactions are recorded through data input into electronic
forms, electronic special journals, or for infrequent transactions, by an electronic
general journal. Balances of affected accounts are automatically posted and
updated from the information recorded on the form. If desired, the computer can
Ex. 5–23
a. iTunes is an example of a B2C, or business-to-consumer e-commerce application
The B, or business, is Apple. The C, or consumers, would mostly be individuals who
purchase digital products from the download store.
b. Cash 15
Fees Earned 15
c. The cash receipts journal is used to record debits to Cash from cash sales or
collections on account.
d. The electronic invoice form can be used for either transactions on account, as
illustrated in the chapter, or for cash sales. The invoice form used for sales on
account is different from the one used for cash sales. The latter invoice form
CHAPTER 5 Accounting Systems
Ex. 5–24
a. Amazon.com B2C. Sells books, DVDs, and other products to
individual consumers.
b. Dell Inc. B2C and B2B. Sells computer products to both
individuals and corporations. Its site separates
individual and corporate sales.
supplies to manufacturing companies.
Ex. 5–25
a. Horizontal analysis:
Amount Percent
Americas $ 9,936 $ 9,065 $ 871 9.6%
EMEA 1,141 1,047 94 9.0%
b. Vertical analysis:
Amount Percent Amount Percent
Americas $ 9,936 74.7% $ 9,065 77.5%
EMEA 1,141 8.6% 1,047 8.9%
Recent Year Prior Year
Increase/(Decrease)
Recent Year
(in millions)
Prior Year
(in millions)
CHAPTER 5 Accounting Systems
Ex. 5–25 (Concluded)
c. The horizontal analysis indicates that the total revenues of Starbucks increased
by more than 13% (13.7%) from the prior year to the recent year. This increase is
explained by improvements in consumer confidence experienced during this
time. Starbucks was positively impacted because its product is both premium
priced and discretionary. Thus, as economic times improved, consumers
increased consumption and/or chose more expensive options. Revenues
CHAPTER 5 Accounting Systems
Ex. 5–26
a.
News Corporation
Major Product Segments
Cable Network Programming $ 9,132 27.1%
Filmed Entertainment 7,302 21.7%
Television 4,734 14.0%
b. News Corporation is very diversified. The Cable Network Programming segment
has the largest percent of revenues to total revenues at 27.1%. This is a low
percent for the largest segment, suggesting little concentration. In addition,
For a Recent
Year (in Millions) Percent
CHAPTER 5 Accounting Systems
Ex. 5–27
a. Horizontal analysis:
Amount Percent
United States $ 8,814 $ 8,528 $286 3.4%
Europe 10,827 10,886 (59) –0.5%
b. Vertical analysis:
United States $ 8,814 32.0% $ 8,528 31.6%
Europe 10,827 39.3% 10,886 40.3%
c. The United States (U.S.) and APMEA segment revenues increased 3.4% and 6.2%
between the two years, respectively. In contrast, Europe and Other Countries &
Corporate declined 0.5% and 2.4%, between the two years, respectively. The higher
growth rate in the APMEA region is partially caused by growing from a smaller base
Percent
Amount
(in millions)
Increase/(Decrease)
Year 2
(in millions)
Year 1
(in millions)
Percent
Year 2 Year 1
Amount
(in millions)
1. and 2.
Page
1
2016
July 21 1 J. Dunlop
22 2 K. Tisdale
24 3 T. Quinn
Page
1
Debit Credit
2016
Description
Date
REVENUE JOURNAL
Account Debited
Post.
Ref.
Post.
Ref.
115
Accounts Rec. Dr.
Fees Earned Cr.
350
85
Invoice
No.
JOURNAL
Date
CHAPTER 5 Accounting Systems
Prob. 5–1A (Continued)
Post.
Item Ref. Debit Credit Balance
2016
July 30 R1 170 170
Post.
Item Ref. Debit Credit Balance
Post.
Item Ref. Debit Credit Balance
2016
July 27 R1 225 225
Post.
Item Ref. Debit Credit Balance
Name: F. Mintz
Date
Date
Name: T. Quinn
Date
D. Chase
Name:
ACCOUNTS RECEIVABLE SUBSIDIARY LEDGER
Name: J. Dunlop
Date
CHAPTER 5 Accounting Systems
Prob. 5–1A (Concluded)
Account No. 12
Post.
Item Ref. Debit Credit Debit Credit
2016
July 31 R1 1,170 1,170
Account No. 13
Post.
Item Ref. Debit Credit Debit Credit
4. The computerized system is much more efficient. Each sales transaction
would be entered into an electronic invoice form. The postings to the accounts
receivable subsidiary and fees earned ledgers would be automatic. Also, all
GENERAL LEDGER
Date
Balance
Accounts Receivable
Account:
Account: Supplies
Balance
Date
CHAPTER 5 Accounting Systems
Prob. 5–2A
1. and 5.
Account No. 11
Post.
Item Ref. Debit Credit Debit Credit
Nov. 1 Balance 11,350
30 CR36 37,600 48,950
Account No. 12
Post.
Item Ref. Debit Credit Debit Credit
Account No. 41
Post.
Item Ref. Debit Credit Debit Credit
Nov. 30 R40 26,620 26,620
Account: Accounts Receivable
2016
Balance
Date
Date
Balance
2016
Cash
GENERAL LEDGER
Account: Fees Earned
2016
Account:
Date
Balance
2. and 4.
Post.
Item Ref. Debit Credit Balance
2016
Nov. 1 Balance 9,460
Post.
Item Ref. Debit Credit Balance
Post.
Item Ref. Debit Credit Balance
2016
Nov. 1 Balance 6,770
6 R40 2,450 9,220
Post.
Item Ref. Debit Credit Balance
2016
Date
Name: Rahal Co.
Date
ACCOUNTS RECEIVABLE SUBSIDIARY LEDGER
Name: Ohr Co.
Name: Shilo Co.
Date
Date
Mendez Co.
Name:
CHAPTER 5 Accounting Systems
Prob. 5–2A (Continued)
3., 4., and 5.
Page
40
2 793 Ohr Co.
6 794 Rahal Co.
Page
36
5 Mendez Co. 9,460
15 Rahal Co. 6,770
Page
1
REVENUE JOURNAL
Account Debited
2,450
Date
Post.
Ref.
Account Credited
Date
Post.
Ref.
5,650
Accounts Rec. Dr.
Fees Earned Cr.
Invoice
No.
CASH RECEIPTS JOURNAL
2016
Nov.
2016
9,460
6,770
Description
2016
Nov.
Cash
Dr.
Accts.
Rec.
Cr.
Fees
Earned
Cr.
Credit
Debit
JOURNAL
Post.
Ref.
Date
CHAPTER 5 Accounting Systems
Prob. 5–2A (Concluded)
7. In an automated system, individual sales transactions are posted automatically
to the general ledger at the time of the original transaction. Thus, there is no
CHAPTER 5 Accounting Systems
Prob. 5–3A
1. and 4.
Account No. 14
Post.
Item Ref. Debit Credit Debit Credit
2016
Oct. 1 Balance 5,920
31 P30 11,930 17,850
Account No. 15
GENERAL LEDGER
Office Supplies
Account:
Account: Field Supplies
Balance
Date
CHAPTER 5 Accounting Systems
Prob. 5–3A (Continued)
2. and 3.
Post.
Item Ref. Debit Credit Balance
2016
Oct. 1 Balance 390
Post.
Item Ref. Debit Credit Balance
2016
Oct. 1 Balance 780
2 P30 400 1,180
Post.
Item Ref. Debit Credit Balance
2016
Post.
Item Ref. Debit Credit Balance
2016
Oct. 5 P30 3,980 3,980
Post.
Item Ref. Debit Credit Balance
Name: Omni Co.
Date
Name: Yamura Co.
Date
Date
Name: Peach Computers Co.
Date
Executive Office Supply Co.
Name:
ACCOUNTS PAYABLE SUBSIDIARY LEDGER
Name: Meade Co.
Date
3. and 4.
Page
30
2016
Oct. 2 400 400
53,980 Office Equipment 18 3,980
PURCHASES JOURNAL
Field
Supplies
Dr.
Account Credited
Meade Co.
Peach Computers Co.
Post.
Ref.
Date
Accounts
Payable
Cr.
Office
Supplies
Dr.
Other
Accounts
Dr.
Post.
Ref.
Amount
1., 2., and 3.
Page
1
16 5,340 5,340
16 21,450 Field Equipment 17 21,450
17 510 510
April
Date
Amount
2016
Accounts
Payable
Cr.
Office
Supplies
Dr.
Other
Accounts
Dr.
Post.
Ref.
PURCHASES JOURNAL
Field
Supplies
Dr.
Best Office Supply Co.
Account Credited
Hydro Supply Co.
Pure Equipment Co.
Post.
Ref.
CHAPTER 5 Accounting Systems
Prob. 5–4A (Continued)
Page
1
2016
April 16 1 Rent Expense 71 3,500
19 2 Field Supplies 14 3,340
Office Supplies 15 400
1. and 2.
Page
1
2016
Date
Description
JOURNAL
Post.
Ref.
Cash
Cr.
Ck.
No.
Account Debited
Date
Debit
3,500
Credit
Other
Accounts
Dr.
Accounts
Payable
Dr.
CASH PAYMENTS JOURNAL
400
3,340
Post.
Ref.
1.
Post.
Item Ref. Debit Credit Balance
2016
April 17 P1 510 510
23 P1 660 1,170
30 CP1 510 660
Post.
Item Ref. Debit Credit Balance
2016
ACCOUNTS PAYABLE SUBSIDIARY LEDGER
Name: Hydro Supply Co.
Date
Date
Best Office Supply Co.
Name:
2. and 3.
Account No. 11
Post.
Item Ref. Debit Credit Debit Credit
30 CP1 203,940 203,940
Account No. 14
Post.
Item Ref. Debit Credit Debit Credit
Account No. 15
Post.
Item Ref. Debit Credit Debit Credit
19 CP1 400 400
30 P1 1,170 1,570
Account No. 17
Post.
Item Ref. Debit Credit Debit Credit
Account No. 19
Post.
Item Ref. Debit Credit Debit Credit
2016
April
Land
Balance
2016
Account:
Date
2016
Balance
Date
Date
Account: Office Supplies
Balance
Date
2016
April
GENERAL LEDGER
Account: Field Equipment
Balance
Date
Balance
Field Supplies
Account:
Account: Cash
CHAPTER 5 Accounting Systems
Prob. 5–4A (Concluded)
Account No. 21
Post.
Item Ref. Debit Credit Debit Credit
Account No. 61
Post.
Item Ref. Debit Credit Debit Credit
4.
Best Office Supply Co. $ 660
Hydro Supply Co. 7,650
5. A subsidiary ledger for the field equipment would allow the company to track
Account: Accounts Payable
Balance
Date
2016
Account: Salary Expense
Accounts Payable Creditor Balances
April 30, 2016
Balance
Date
AQUAFRESH WATER TESTING SERVICE
2016
