At the beginning of the current season on April 1, the ledger of Granite Hills Pro Shop showed...

Question:

At the beginning of the current season on April 1, the ledger of Granite Hills Pro Shop showed Cash $3,010: Inventory $4,010; and Common Stock $7,020.

The following transactions occurred during April 2017:

Apr. 5 Purchased golf bags, clubs and balls on account from Arnie Co. $ 1,530, terms 4/10, n/60.
7 Paid freight on Arnie Co. purchases $ 82.
9 Received credit from Arnie Co. for merchandise returned $230.
10 Sold merchandise on account to members $ 1,367, terms n/30.
12 Purchased golf shoes, sweaters and other accessories on account from Woods Sportswear, $847, terms 2/10, n/30.
14 Paid Arnie Co. in full.
17 Received credit from Woods Sportswear for merchandise returned $ 47.
20 Made sales on account to members $ 826, terms n/30.
21 Paid Woods Sportswear in full.
27 Granted credit to members for clothing that did not fit properly $ 82.
30 Received payments on account from members $ 1,244.

Required:

1. Using T accounts, enter the beginning balances in the ledger accounts and post the April transactions.

2. Post entries in the order of journal entries posted in #1.

(Round answers to 0 decimal places)

General Ledger

General Ledger is an internal file being used by a business to check the balances of all the accounts it recorded. Normally, an accurate General Ledger has a balanced debit and credit amounts. Furthermore, the accounts can be further classified in the General Ledger according to it nature (Asset, Liability or Owner's Equity)

Answer and Explanation: 1

  • Requirement 1

Below are the beginning general ledger balances of Granite Hills Pro Shop:

  • Cash

Date Debit Credit Date
Apr. 01 $3,010
Totals $3,010
  • Inventory

Date Debit Credit Date
Apr. 01 $4,010
Totals $4,010
  • Common Stocks

Date Debit Credit Date
$7,020 Apr. 01,
Totals $7,020

Before proceeding to the second requirement, let us plot first the necessary journal entries in order to clearly assess the effect of each transaction to the general ledger:

Date Account Name Debit Credit
Apr. 05 Merchandise Inventory 1,530
Accounts Payable 1,530
Apr. 07 Merchandise Inventory 82
Cash 82
Apr. 09 Accounts Payable 230
Merchandise Inventory 230
Apr. 10 Accounts Receivable 1,367
Sales Revenue 1,367
Apr. 12 Merchandise Inventory 847
Accounts Payable 847
Apr. 14 Accounts Payable
($1,530 - $230)
1,300
Cash
($1,300 x 96%)
1,248
Purchased Discount
($1,300 x 4%)
52
Apr. 17 Accounts Payable 47
Merchandise Inventory 47
Apr. 20 Accounts Receivable 826
Sales Revenue 826
Apr. 21 Accounts Payable
($847 - $47)
800
Cash
($800 x 98%)
784
Purchase Discount
($800 x 2%)
16
Apr. 27 Sales Returns and Allowances 82
Accounts Receivable 82
Apr. 30 Cash 1,244
Sales Revenue 1,244
  • Requirement 2


  • Cash

Date Debit Credit Date
Apr. 01 $3,010 $82 Apr. 07
Apr. 30 1,244 1,248 Apr. 14
784 Apr. 21
Totals $2,140
  • Inventory

Date Debit Credit Date
Apr. 01 $4,010 $230 Apr. 09
Apr. 05 1,530 47 Apr. 14
Apr. 07 82
Apr. 12 847
Totals $6,192
  • Purchase Discount

Date Debit Credit Date
$52 Apr. 14
16 Apr. 21
Totals $68
  • Accounts Receivable

Date Debit Credit Date
Apr. 10 $1,367 $82 Apr. 27
Apr. 20 826
Totals $2,111
  • Accounts Payable

Date Debit Credit Date
Apr. 09 $230 $1,530 Apr. 05
Apr. 14 1,300847 Apr. 12
Apr. 17 47
Apr. 21 800
Totals $0
  • Common Stocks

Date Debit Credit Date
$7,020 Apr. 01
Totals $7,020
  • Sales Revenue

Date Debit Credit Date
$1,367 Apr. 10
826 Apr. 20
1,244 Apr. 30
Totals $3,437
  • Sales Returns and Allowance

Date Debit Credit Date
Apr. 27 $82
Totals $82

Learn more about this topic:

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What Is a General Ledger? - Definition & Examples

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Chapter 1 / Lesson 18
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Discover the general ledger definition, learn about the differences between the general ledger and the general journal, and see a general journal example.


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