50.1K

Verified Solution

Link Copied!

Sun&Fun Company uses a perpetual inventory system and both an accounts receivable and an accounts payable subsidiary ledger. Balances related to both the general ledger and the subsidiary ledger for the company are indicated in the working papers. Below are a series of transactions for Sun&Fun Co. for the month of January. Credit sales terms are 2/10, 1/30. The cost of all merchandise sold was 56% of the sales price. Jan. 3 Sell merchandise on account to M. Knast $2,900, invoice no. 825, and to C. Ryder $1,800, invoice no. 826. 5 Purchase merchandise from R. Drifter $5,000 and N. Sova $2,200, terms 1/30. 7 Receive checks from V. Amold $4,000 and I. Tan $2.000 after discount period has lapsed. 8 Pay freight on merchandise purchased $235. 9 Send checks to K. Xerxes for balance currently due less 2% cash discount, and to T. Caper for balance currently due less 1% cash discount. 9 Issue credit of $300 to C. Ryder for merchandise returned. 10 Summary daily cash sales total $15,500. 11 Sell merchandise on account to D. Gallagher $1,600, invoice no. 827, and to V. Amold $900, invoice no. 12 Pay rent of $1,000 for January. 13 Receive payment in full from M. Knast and C. Ryder less cash discounts. 15 Withdrawal of 8800 cash by J. Sandy for personal use. 15 Post all entries to the subsidiary ledgers. 16 Purchase merchandise from T. Caper $18,000, terms 1/10, 1/30: K. Xerxes $14,200, terms 2/10, 1/30; and R. Drifter $1,500, terms n/30. 17 Pay S400 cash for office supplies. 18 Return $450 of merchandise to K. Xerxes and receive credit. 20 Summary daily cash sales total $20,100. 21 Issue $15,000 note, maturing in 90 days, to M. Griffon in payment of balance due 21 Receive payment in full from V. Arnold less cash discount. 22 Sell merchandise on account to M. Knast $2,700, invoice no. 829, and to D. Gallagher $1,300, invoice no 830. 22 Post all entries to the subsidiary ledgers. 23 Send checks to T. Caper and K. Xences in full payment less cash discounts. 25 Sell merchandise on account to I. Tan $3,500, invoice no. 831, and to C. Ryder 56, 100, invoice no, 832. 27 Purchase merchandise from T. Caper $14,500, terms 1/10, 1/30; N. Sovn $1,200, terms 1/30; and R. Drifter $3,800, terms n/30. 27 Post all entries to the subsidiary ledgers. (continued) Page 2 of 19 28 Pay $200 cash for office supplies. 31 Summary daily cash sales total $21,300. 31 Paysalaries and wages of $8,100. INSTRUCTIONS: (6) Record the January transactions in a sales journal, a single-column purchases journal, a cash receipts journal, a cash payments joumal, and a two-column general journal. (b) Post the journals to the general ledger. (c) Prepare a trial balance at January 31, 2020, in the trial balance columns of the worksheet. Complete the worksheet using the following additional information: 1) Office supplies at January 31 total $850. 2) Insurance coverage expires on October 31, 2020. 3) Annual depreciation on the equipment is $1,500. 4) Interest of $50 has accrued on the note payable. (d) Prepare a multiple-step income statement and an owner's equity statement for January and a classified balance sheet at the end of January. (e) Prepare and post adjusting and closing entries. () Prepare a post-closing trial balance and determine whether the subsidiary ledgers agree with the control accounts in the general ledger. (s) Calculate the following ratios. Include the written formula in words in addition to your calculations and your final answers 1) Inventory Turnover 2) Days in Inventory 3) Gross Profit Rate 4) Working Capital Page 3 of 19 Cash Receipts Journal, total Cash DR: Cash Payments Journal, total Cash CR: Net Income: Total Assets Total Post Closing Trial Balance: $68,094 61.740 23,725 134,875 136,500 Name Section Date Sun&FunCo. Sales Journal Account Debited Invoice No. Accounts Receivable Dr. Ref. Sales Revenue Cr. COGS Dr. Inventory Cr Purchases Journal Account Credited Inventory Dr. Acc. PeyC Date Terms Ret Sun&Fun Company uses a perpetual inventory system and both an accounts receivable and an accounts payable subsidiary ledger. Balances related to both the general ledger and the subsidiary ledger for the company are indicated in the working papers. Below are a series of transactions for Sun&Fun Co. for the month of January. Credit sales terms are 2/10, 1/30. The cost of all merchandise sold was 56% of the sales price. Jan. 3 Sell merchandise on account to M. Knast $2,900, invoice no. 825, and to C. Ryder $1,800, invoice no. 826. 5 Purchase merchandise from R. Drifter $5,000 and N. Sova $2,200, terms 1/30. 7 Receive checks from V. Amold $4,000 and I. Tan $2.000 after discount period has lapsed. 8 Pay freight on merchandise purchased $235. 9 Send checks to K. Xerxes for balance currently due less 2% cash discount, and to T. Caper for balance currently due less 1% cash discount. 9 Issue credit of $300 to C. Ryder for merchandise returned. 10 Summary daily cash sales total $15,500. 11 Sell merchandise on account to D. Gallagher $1,600, invoice no. 827, and to V. Amold $900, invoice no. 12 Pay rent of $1,000 for January. 13 Receive payment in full from M. Knast and C. Ryder less cash discounts. 15 Withdrawal of 8800 cash by J. Sandy for personal use. 15 Post all entries to the subsidiary ledgers. 16 Purchase merchandise from T. Caper $18,000, terms 1/10, 1/30: K. Xerxes $14,200, terms 2/10, 1/30; and R. Drifter $1,500, terms n/30. 17 Pay S400 cash for office supplies. 18 Return $450 of merchandise to K. Xerxes and receive credit. 20 Summary daily cash sales total $20,100. 21 Issue $15,000 note, maturing in 90 days, to M. Griffon in payment of balance due 21 Receive payment in full from V. Arnold less cash discount. 22 Sell merchandise on account to M. Knast $2,700, invoice no. 829, and to D. Gallagher $1,300, invoice no 830. 22 Post all entries to the subsidiary ledgers. 23 Send checks to T. Caper and K. Xences in full payment less cash discounts. 25 Sell merchandise on account to I. Tan $3,500, invoice no. 831, and to C. Ryder 56, 100, invoice no, 832. 27 Purchase merchandise from T. Caper $14,500, terms 1/10, 1/30; N. Sovn $1,200, terms 1/30; and R. Drifter $3,800, terms n/30. 27 Post all entries to the subsidiary ledgers. (continued) Page 2 of 19 28 Pay $200 cash for office supplies. 31 Summary daily cash sales total $21,300. 31 Paysalaries and wages of $8,100. INSTRUCTIONS: (6) Record the January transactions in a sales journal, a single-column purchases journal, a cash receipts journal, a cash payments joumal, and a two-column general journal. (b) Post the journals to the general ledger. (c) Prepare a trial balance at January 31, 2020, in the trial balance columns of the worksheet. Complete the worksheet using the following additional information: 1) Office supplies at January 31 total $850. 2) Insurance coverage expires on October 31, 2020. 3) Annual depreciation on the equipment is $1,500. 4) Interest of $50 has accrued on the note payable. (d) Prepare a multiple-step income statement and an owner's equity statement for January and a classified balance sheet at the end of January. (e) Prepare and post adjusting and closing entries. () Prepare a post-closing trial balance and determine whether the subsidiary ledgers agree with the control accounts in the general ledger. (s) Calculate the following ratios. Include the written formula in words in addition to your calculations and your final answers 1) Inventory Turnover 2) Days in Inventory 3) Gross Profit Rate 4) Working Capital Page 3 of 19 Cash Receipts Journal, total Cash DR: Cash Payments Journal, total Cash CR: Net Income: Total Assets Total Post Closing Trial Balance: $68,094 61.740 23,725 134,875 136,500 Name Section Date Sun&FunCo. Sales Journal Account Debited Invoice No. Accounts Receivable Dr. Ref. Sales Revenue Cr. COGS Dr. Inventory Cr Purchases Journal Account Credited Inventory Dr. Acc. PeyC Date Terms Ret

Answer & Explanation Solved by verified expert

See Answer