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 | 1,300 | 847 | 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:
from
Chapter 1 / Lesson 18Discover the general ledger definition, learn about the differences between the general ledger and the general journal, and see a general journal example.