APPENDIX I
Subsidiary Ledgers and Special Journals
ASSIGNMENT CLASSIFICATION TABLE
Learning Objectives
Questions
Brief
Exercises
Do It!
Exercises
1. Describe the nature and
purpose of a subsidiary
ledger.
1, 2, 5, 7,12
1, 2
1
1, 2, 3, 4, 5, 6,
7, 9, 11, 12
2. Explain how companies
3, 4, 6, 7, 8, 9,
10, 13
3, 4, 5, 6
2
6, 7, 8, 10, 12
1A, 2A, 3A,
4A, 5A, 6A
3. Indicate how companies
journal.
8, 11
7
1, 3, 9, 11, 13,
1A, 2A, 3A,
4A, 5A, 6A
ASSIGNMENT CHARACTERISTICS TABLE
Problem
Number
Description
Difficulty
Level
Time
Allotted (min.)
1A
Journalize transactions in cash receipts journal;
post to control account and subsidiary ledger.
Simple
30–40
2A
Journalize transactions in cash payments journal;
post to control account and subsidiary ledgers.
Simple
30–40
3A
Journalize transactions in multi-column purchases
journal; post to the general and subsidiary ledgers.
40–50
Journalize transactions in special journals.
prepare adjusting entries; prepare an adjusted
trial balance.
6A
Journalize in special journals; post; prepare
a trial balance.
60–70
BLOOM’ S TAXONOMY TABLE
Correlation Chart between Bloom’s Taxonomy, Learning Objectives and End–of-Chapter Exercises and Problems
Learning Objective
Knowledge
Comprehension
Application
Analysis
Synthesis
Evaluation
1. Describe the nature and purpose
of a subsidiary ledger.
QI-1
QI-2
QI-5
QI–12
BEI-1
BEI-2
EI-2
EI–11
DII-1
EI-1
EI-3
EI-4
EI-5
EI-6
EI-7
EI-9
EI–11
EI–12
PI-1A
PI–2A
PI–3A
PI–4A
PI–5A
PI–6A
QI-7
EI–12
PI–1A
PI–2A
PI–3A
QI-8
QI–11
BEI-7
EI-1
EI-3
EI-9
EI–13
EI–14
PI–1A
PI–2A
PI–3A
PI–5A
PI–6A
(Mini Practice Set)
ANSWERS TO QUESTIONS
1. A subsidiary ledger is a group of accounts with a common characteristic. The accounts are assembled
2. (a) (1) Transactions to individual accounts are generally posted daily to the subsidiary ledger.
3. Sales journal. Records entries for all sales of merchandise on account.
In general, special journals: (1) allow greater division of labor because various individuals can
record entries in different journals at the same time; and (2) reduce posting time of journals.
4. The entry for the sales return should be recorded in the general journal. Since Burguet Company
Questions Appendix I (Continued)
5. At the end of the month, after all postings to both the general ledger and the subsidiary accounts
6. The purpose of special journals is to facilitate the recording process of the business entity. Therefore,
8. The special journal is the sales journal. The other account is Sales Revenue. (The cash receipts
11. Typically included would be credit purchases of equipment, office supplies, and store supplies.
SOLUTIONS TO BRIEF EXERCISES
BRIEF EXERCISE I-1
Accounts Receivable Subsidiary Ledger
General Ledger
Adcock Co.
Accounts Receivable
BRIEF EXERCISE I-2
BRIEF EXERCISE I-3
BRIEF EXERCISE I-4
Debit
9,000
BRIEF EXERCISE I-5
(a). General Journal (if a one-column Purchases Journal)
BRIEF EXERCISE I-6
(a). Cash Receipts Journal
BRIEF EXERCISE I-7
SOLUTIONS FOR DO IT! REVIEW EXERCISES
DO IT! I-1
Subsidiary balances:
DO IT! I-2
SOLUTIONS TO EXERCISES
EXERCISE I-1
(a) $344,400. Beginning balance of $314,000 plus $161,400 debit from sales
journal less $131,000 credit from cash receipts journal.
EXERCISE I-2
To: Erica Grier, Chief Financial Officer
From: Student
Subject: Martha Nott account
The explanation of the three entries in the subsidiary ledger for the Martha
Nott account is as follows:
EXERCISE I-3
(a) & (b) General Ledger
Accounts Receivable
Date
Explanation
Ref.
Debit
Credit
Balance
Dey
Date
Explanation
Ref.
Debit
Credit
Balance
Date
Explanation
Debit
Credit
Balance
Date
Explanation
Debit
Credit
Balance
EXERCISE I-3 (Continued)
Zeyen
Date
Explanation
Ref.
Debit
Credit
Balance
(c) STARK COMPANY
Schedule of Customers
As of September 30, 2017
EXERCISE I-4
(a) $3,700 [$10,200 – ($4,000 + $2,500)].
EXERCISE I-5
(a) $3,375 [$8,250 – ($3,000 + $1,875)].
EXERCISE I-6
(a) & (b) NORREN COMPANY
Sales Journal S1
Date
Account
Debited
Invoice
No.
Ref.
Accounts Receivable Dr.
Sales Revenue Cr.
Cost of Goods Sold Dr.
Inventory Cr.
EXERCISE I-7
(a) & (b) MILNER CO.
Cash Receipts Journal CR1
Date
Account
Credited
Ref.
Cash
Dr.
Sales
Discounts
Dr.
Accounts
Receivable
Cr.
Sales
Revenue
Cr.
Other
Accounts
Cr.
Cost of Goods Sold
Dr.
Inventory
Cr.
2
Common Stock
9,000
9,000
EXERCISE I-7 (Continued)
MILNER CO.
Cash Payments Journal CP1
Date
Ck.
No.
Account Debited
Ref.
Other
Accounts
Dr.
Accounts
Payable
Dr.
Cash
Cr.
EXERCISE I-8
(a) Journal
(b) Columns in the journal
Cash Payments
Cash Receipts
Sold (Dr.), and Inventory (Cr.).
1.
2.
Cash Payments
Cash Receipts
Cash (Cr.), Other Accounts (Dr.).
Cash (Dr.), Sales Discounts (Dr.), and
May 3
Inventory
Salaries and Wages Expense
700
EXERCISE I-9
(a) Mar. 2 Equipment …………………………………………….. 9,400
Accounts Payable—Brantly
Company ……………………………………. 9,400
(b) To: President Nolasco
From: Chief Accountant
Subject: Posting of Control and Subsidiary Accounts
The posting of these accounts varies with the journals used in recording
the transactions.
EXERCISE I-10
1. Cash Payments Journal 8. Cash Receipts Journal
EXERCISE I-11
(a) The debit posting reference on February 28 should be from the cash
EXERCISE I-12
(a)
Purchases Journal P1
Date
Account Credited
Ref.
Inventory Dr.
Accounts Payable Cr.
EXERCISE I-12 (Continued)
(b)
General Journal
Date
Accounts and Explanations
Ref.
Debit
Credit
EXERCISE I-13
EXERCISE I-14
SOLUTIONS TO PROBLEMS
PROBLEM I-1A
(a)
Cash Receipts Journal CR1
Account
Cash
Sales
Discounts
Accounts
Receivable
Sales
Revenue
Cr.
Other
Accounts
Cost of Goods Sold
Dr.
Inventory
(b) General Ledger
Accounts Receivable No. 112
Date
Explanation
Ref.
Debit
Credit
Balance
Accounts Receivable Subsidiary Ledger
Park
Date
Explanation
Ref.
Debit
Credit
Balance
Hurt Co.
Kolten
1,500
PROBLEM I-1A (Continued)
Kolten
Date
Explanation
Ref.
Debit
Credit
Balance
Hurt Co.
Date
Explanation
Ref.
Debit
Credit
Balance
Afzal
Date
Explanation
Ref.
Debit
Credit
Balance
PROBLEM I-2A
(a)
Cash Payments Journal CP1
Date
Ck.
No.
Account Debited
Ref.
Other
Accounts
Dr.
Accounts
Payable
Dr.
Inventory
Cr.
Cash
Cr.
(b) General Ledger
Accounts Payable No. 201
Date
Explanation
Ref.
Debit
Credit
Balance
PROBLEM I-2A (Continued)
Trent Company
PROBLEM I-3A
(a)
Purchases Journal P1
Accounts
Payable
Inventory
Other
Accounts
Sales Journal S1
Date
Account Debited
Ref.
Accounts Receivable Dr.
Sales Revenue Cr.
Cost of Goods Sold Dr.
Inventory Cr.
PROBLEM I-3A (Continued)
General Journal G1
Date
Accounts and Explanations
Ref.
Debit
Credit
(b) General Ledger
Accounts Receivable No. 112
Date
Explanation
Ref.
Debit
Credit
Balance
PROBLEM I-3A (Continued)
Equipment No. 157
Date
Explanation
Ref.
Debit
Credit
Balance
Cost of Goods Sold No. 505
Date
Explanation
Ref.
Debit
Credit
Balance
Date
Explanation
Ref.
Debit
Credit
Balance
Date
Ref.
Debit
Credit
Balance
Date
Explanation
Ref.
Debit
Credit
Balance
PROBLEM I-3A (Continued)
Accounts Receivable Subsidiary Ledger
Orsen Bros.
Date
Explanation
Ref.
Debit
Credit
Balance
Gentry Company
Date
Explanation
Ref.
Debit
Credit
Balance
Date
Explanation
Ref.
Credit
Balance
Date
Explanation
Ref.
Credit
Balance
Date
Explanation
Ref.
Credit
Balance
PROBLEM I-3A (Continued)
Rensing Shipping
Date
Explanation
Ref.
Debit
Credit
Balance
Langer Company
Date
Explanation
Ref.
Debit
Credit
Balance
Date
Explanation
Ref.
Debit
Credit
Balance
Explanation
Ref.
Debit
Credit
PROBLEM I-3A (Continued)
(c) Accounts receivable balance …………………………... $16,965
PROBLEM I-4A
(a), (b) & (c)
Sales Journal S1
Date
Account
Debited
Invoice
No.
Ref.
Accounts Receivable Dr.
Sales Revenue Cr.
Cost of Goods Sold Dr.
Inventory Cr.
Purchases Journal P1
Date
Account Credited
Ref.
Inventory Dr.
Accounts Payable Cr.
PROBLEM I-4A (Continued)
Cash Receipts Journal CR1
Date
Account
Credited
Ref.
Cash
Dr.
Sales
Discounts
Dr.
Accounts
Receivable
Cr.
Sales
Revenue
Cr.
Other
Accounts
Cr.
Cost of Goods Sold
Dr.
Inventory
Cr.
30,576
1,200
13,200
(X)
PROBLEM I-5A
(a), (d) & (g) General Ledger
Cash No. 101
Date
Explanation
Ref.
Debit
Credit
Balance
Inventory No. 120
Date
Explanation
Ref.
Debit
Credit
Balance
Date
Explanation
Ref.
Debit
Credit
Balance
Date
Ref.
Debit
Credit
Balance
Date
Explanation
Ref.
Debit
Credit
Balance
PROBLEM I-5A (Continued)
Accounts Payable No. 201
Date
Explanation
Ref.
Debit
Credit
Balance
Sales Revenue No. 401
Date
Explanation
Ref.
Debit
Credit
Balance
Date
Ref.
Credit
Balance
Date
Explanation
Ref.
Debit
Credit
Balance
Date
Explanation
Ref.
Debit
Credit
Balance
Date
Explanation
Ref.
Debit
Credit
Balance
PROBLEM I-5A (Continued)
Supplies Expense No. 631
Date
Explanation
Ref.
Debit
Credit
Balance
(b)
Sales Journal S1
Date
Account Debited
Ref.
Accounts Receivable Dr.
Sales Revenue Cr.
Cost of Goods Sold Dr.
Inventory Cr.
Cash Receipts Journal CR1
Date
Account
Credited
Ref.
Cash
Dr.
Sales
Discounts
Dr.
Accounts
Receivable
Cr.
Sales
Revenue
Cr.
Other
Accounts
Cr.
Cost of Goods Sold
Dr.
Inventory
Cr.
(414)
Date
Explanation
Ref.
Debit
Credit
Balance
PROBLEM I-5A (Continued)
(c) Accounts Receivable Subsidiary Ledger
Edwards Co.
Date
Explanation
Ref.
Debit
Credit
Balance
Date
Explanation
Ref.
Debit
Credit
Date
Explanation
Ref.
Debit
Credit
Balance
Carmoni
Date
Explanation
Ref.
Debit
Credit
Balance
Date
Explanation
Ref.
Debit
Credit
Date
Explanation
Ref.
Debit
Credit
Balance
PROBLEM I-5A (Continued)
G. Young
Date
Explanation
Ref.
Debit
Credit
Balance
(e) RAMIREZ CO.
Trial Balance
July 31, 2017
Date
Explanation
Ref.
Credit
Balance
Explanation
Ref.
Debit
Credit
PROBLEM I-5A (Continued)
PROBLEM I-5A (Continued)
(h) RAMIREZ CO.
Adjusted Trial Balance
July 31, 2017
PROBLEM I-6A
(b) & (c)
Cash Receipts Journal CR1
Date
Account Credited
Ref.
Cash
Dr.
Sales
Discounts
Dr.
Accounts
Receivable
Cr.
Sales
Revenue
Cr.
Other
Accounts
Cr.
Cost of Goods Sold
Dr.
Inventory
Cr.
Sales Journal S1
Date
Account
Debited
Ref.
Accounts Receivable Dr.
Sales Revenue Cr.
Cost of Goods Sold Dr.
Inventory Cr.
(X)
PROBLEM I-6A (Continued)
Purchases Journal P1
Date
Account Credited
Ref.
Inventory Dr.
Accounts Payable Cr.
General Journal G1
Date
Accounts and Explanations
Ref.
Debit
Credit
(a) & (c)
General Ledger
Cash No. 101
Date
Explanation
Ref.
Debit
Credit
Balance
PROBLEM I-6A (Continued)
Accounts Receivable No. 112
Date
Explanation
Ref.
Debit
Credit
Balance
Inventory No. 120
Date
Explanation
Ref.
Debit
Credit
Balance
Equipment No. 157
Date
Explanation
Ref.
Debit
Credit
Balance
PROBLEM I-6A (Continued)
Notes Payable No. 200
Common Stock No. 311
Date
Explanation
Ref.
Debit
Credit
Balance
Date
Explanation
Ref.
Debit
Credit
Balance
Explanation
Ref.
Debit
Credit
Balance
Date
Explanation
Ref.
Credit
Balance
Date
Explanation
Ref.
Credit
Balance
Explanation
Ref.
Debit
Credit
Balance
PROBLEM I-6A (Continued)
Cost of Goods Sold No. 505
Date
Explanation
Ref.
Debit
Credit
Balance
Date
Explanation
Ref.
Debit
Credit
Accounts Receivable Subsidiary Ledger
Explanation
Ref.
Credit
Balance
PROBLEM I-6A (Continued)
Accounts Payable Subsidiary Ledger
PROBLEM I-6A (Continued)
(d) BENSEN CO.
Trial Balance
January 31, 2017
PROBLEM I-6A (Continued)
COMPREHENSIVE PROBLEM: CHAPTERS 3 TO 6 AND APPENDIX I
Note: If the working papers that accompany this text are not used in
solving this problem, account numbers may differ from those presented in
this solution.
(a)
Sales Journal S1
Date
Account Debited
Invoice No.
Ref.
Accounts Receivable Dr.
Sales Cr.
Purchases Journal P1
Purchases Dr.
COMPREHENSIVE PROBLEM (Continued)
Cash Receipts Journal CR1
Date
Account
Credited
Ref.
Cash
Dr.
Accounts
Receivable
Cr.
Sales
Cr.
Other
Accounts
Cr.
Cash Payments Journal CP1
Date
Account Debited
Ref.
Other
Accounts
Dr.
Accounts
Payable
Dr.
Supplies
Dr.
Cash
Cr.
9,230
(X)
7,400
COMPREHENSIVE PROBLEM (Continued)
(a) & (e)
General Journal G1
Date
Account Titles and Explanations
Ref.
Debit
Credit
M. Fischer ……………………….
112/
Allowances ……………………..
512
Notes Payable …………………….
200
Adjusting Entries
31
Supplies Expense ……………………….
Supplies ……………………………..
728
125
1,020
1,020
31
Insurance Expense
(1/12 X $1,500) …………………………
Accumulated Depreciation—
Equipment ………………………
711
Interest Expense …………………………
Interest Payable ………………….
718
COMPREHENSIVE PROBLEM (Continued)
General Journal G1
Date
Account Titles and Explanations
Ref.
Debit
Credit
31
Income Summary ………………………..
Retained Earnings ……………….
350
320
8,775
8,775
31
Retained Earnings ……………………….
Cash Dividends …………………..
320
332
Date
Explanation
Ref.
(b) & (e) General Ledger
Allowances ……………………………..
Income Summary ………………..
512
350
91,270
Interest Expense …………………
718
COMPREHENSIVE PROBLEM (Continued)
Accounts Receivable No. 112
COMPREHENSIVE PROBLEM (Continued)
Accumulated Depreciation—Equipment No. 158
Interest Payable No. 230
COMPREHENSIVE PROBLEM (Continued)
Income Summary No. 350
Sales Returns and Allowances No. 412
Date
Explanation
Credit
Balance
Purchase Returns and Allowances No. 512
Date
Explanation
Ref.
Debit
Credit
Balance
Date
Explanation
Debit
Credit
Date
Explanation
Debit
Credit
COMPREHENSIVE PROBLEM (Continued)
COMPREHENSIVE PROBLEM (Continued)
Rent Expense No. 729
COMPREHENSIVE PROBLEM (Continued)
W. Rayms
COMPREHENSIVE PROBLEM (Continued)
COMPREHENSIVE PROBLEM (Continued)
(c) ZWEIFEL COMPANY
Worksheet
For the Month Ended January 31, 2017
Trial Balance
Adjustments
Adjusted
Trial Balance
Income
Statement
Balance Sheet
Account Titles
Dr.
Cr.
Dr.
Cr.
Dr.
Cr.
Dr.
Cr.
Dr.
Cr.
COMPREHENSIVE PROBLEM (Continued)
(d) ZWEIFEL CO.
Income Statement
For the Month Ended January 31, 2017
COMPREHENSIVE PROBLEM (Continued)
ZWEIFEL CO.
Statement Retained Earnings
For the Month Ended January 31, 2017
ZWEIFEL CO.
Balance Sheet
January 31, 2017
COMPREHENSIVE PROBLEM (Continued)
(f) ZWEIFEL CO.
Post-Closing Trial Balance
January 31, 2017
BYP I-1 FINANCIAL REPORTING PROBLEM—A MINI PRACTICE SET
(a)
Sales Journal S1
Date
Account
Debited
Invoice
No.
Ref.
Accounts Receivable Dr.
Sales Revenue Cr.
Cost of Goods Sold Dr.
Inventory Cr.
Purchases Journal P1
Date
Account Credited
Terms
Ref.
Inventory Dr.
Accounts Payable Cr.
BYP I-1 (Continued)
Cash Receipts Journal CR1
Date
Account
Credited
Ref.
Cash
Dr.
Sales
Discounts
Dr.
Accounts
Receivable
Cr.
Sales
Revenue
Cr.
Other
Accounts
Cr.
Cost of Goods Sold
Dr.
Inventory
Cr.
Cash Payments Journal CP1
Date
Account Debited
Ref.
Other
Accounts
Dr.
Accounts
Payable
Dr.
Supplies
Dr.
Inventory
Cr.
Cash
Cr.
Expense
(X)
52,000
(112)
BYP I-1 (Continued)
(a) & (e)
General Journal G1
Date
Account Titles and Explanations
Ref.
Debit
Credit
BYP I-1 (Continued)
General Journal G1
Date
Account Titles and Explanations
Ref.
Debit
Credit
Date
Credit
Date
Explanation
Credit
BYP I-1 (Continued)
Notes Receivable No. 115
Date
Explanation
Ref.
Debit
Credit
Balance
Date
Explanation
Ref.
Credit
Explanation
Debit
Credit
Explanation
Debit
Credit
BYP I-1 (Continued)
Accumulated Depreciation—Equipment No. 158
Date
Explanation
Ref.
Debit
Credit
Balance
Date
Explanation
Debit
Credit
Balance
Date
Explanation
Ref.
Debit
Credit
Balance
BYP I-1 (Continued)
Income Summary No. 350
Sales Discounts No. 414
BYP I-1 (Continued)
Salaries and Wages Expense No. 627
Interest Expense No. 718
BYP I-1 (Continued)
Rent Expense No. 729
Accounts Receivable Subsidiary Ledger
C. Dunlap
BYP I-1 (Continued)
A. Mangrich
BYP I-1 (Continued)
D. Vang
BYP I-1 (Continued)
(c) BRYANT COMPANY
Worksheet
For the Month Ended January 31, 2017
Trial Balance
Adjustments
Adjusted
Trial Balance
Income
Statement
Balance Sheet
Account Titles
Dr.
Cr.
Dr.
Cr.
Dr.
Cr.
Dr.
Cr.
Dr.
Cr.
Net Income
Totals
BYP I-1 (Continued)
(d) BRYANT CO.
Income Statement
For the Month Ended January 31, 2017
BYP I-1 (Continued)
BRYANT CO.
Retained Earnings Statement
For the Month Ended January 31, 2017
BRYANT CO.
Balance Sheet
January 31, 2017
BYP I-1 (Continued)
(f) BRYANT CO.
Post-Closing Trial Balance
January 31, 2017
BYP I-2 REAL-WORLD FOCUS
Some of the key features of the general ledger module highlighted by
the company are:
Some of the key features of the payables management module highlighted
by the company are:
BYP I-3 DECISION–MAKING ACROSS THE ORGANIZATION
(a) The special journals for Garin & Clark should be: (1) sales journal, (2)
purchases journal, (3) cash receipts journal, and (4) cash payments
journal.
3. Cash Receipts Journal columns:
BYP I-3 (Continued)
4. Cash Payments Journal columns:
(b) Garin & Clark should have:
1. An accounts receivable control account with individual customers’
accounts in a customers’ subsidiary ledger.
BYP I-4 COMMUNICATION ACTIVITY
Mr. Peter Gogan
2 Main Street
Central City, Michigan 48172
Dear Mr. Gogan:
Thank you for hiring two additional bookkeepers a month ago to help me with
BYP I-5 ETHICS CASE
(a) The stakeholders in this case are:
(b) Orlando instructions to assign the Bayport code to all uncoded and