ACC 121 Project
(Use the working papers provided by your instructor to work this practice set project.)
Colorado 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 Colorado Co. are indicated in the working papers. Below arc a series of transactions for the company for the month of January. Credit .1es terms are /10, ni30. The cost of all merchandise sold was 62% of the sates price.
Sell merchandise on account to B. Richey S2,900, invoice no. 510, and to J. Forbes 01,800, invoice no. 511.
5 Purchase merchandise from S. Vogel $5,000 and 0. Lynch S2,200, terms ni30.
7 Receive checks from S. LaDew S4,000 and B. Garcia S2,000 atter discount period has lapsed.
8 Pay freight on merchandise purchased S2.35.
9 Send cheeks to S. Hoyt for S9,000 less cash discount, and to D. Drnara for S11,000 le. 1%
discount.
9 Issue credit of $300 to J. Forbes for merchandise rctumcd
10 Summary daily cash sales total S15,500.
Soli merchandise on account to R. Dvorak S1,600, invoice no. 512, and to S. LaDcw $900, no. 513.
12 Pay rcpt of $1,000 for January.
13 Receive payment in full from B. Richey and .1 Forbes loos cash discounts.
15 Withdrawal of $800 cash by J. Colorado for her personal use.
15 Poo all entries to the subsidiary ledgers.
16 Purchase merchandise from D. Omara $18,000, terms 1/10, n/30; S. Hoyt $l4,200, terms 2/1 ni.30; and S. Vogel 01,500, terms n'30.
17 Pay $600 cash for office supplies.
18 Return $200 of merchandise to S. Hoyt and receive credit.
20 Summary daily cash sales total 020,100.
21 Issue 515,000 note. maturing in 90 days, to R. Moses in payment of balance due.
21 Receive payment in full from S. LaDew less cash discount.
XSell merchandise on account to B. Richey 52,700, invoice no. 514, and to R. Dvorak 52,800, invoice no. 515.
22 Post all cntries to the subsidiary ledgers.
23 Send checks to D. Omara and S. Hoyt in full payment less cash discounts.
2Ik Sell merchandise on account to B. Garcia $3,500, invoice no. 516, and to J. Forbes 56,100, invoice no. 517.
27 Purchase merchandise from D. Omara S14,500, terms 1/10, n/30; D. Lynch 01,200, terms n:10, and S. Vogel $5,400, terms n130.
27 Post all entries to the subsidiary ledgers.
2$ Pay $200 cash for office supplies.
31 Summary daily cash salts total 321,300.
31 Pay total salaries of 513, 100.
(continued)
Page 1 of 2
Instructions
(a) Record the January transactions in a sales journal, a single-column purchases journal, a cash receipts
journal, a cash payments journal, and a two-column general journal.
(b) Post the journals to the general ledger.
(c) Prepare a trial balance at January 31, 2018,in the trial balance columns of the worksheet. Complete the worksheet using the following additionalinormation.
1. Office supplies at January 31 total $750.
2. Insurance coverage expires on October 31, 2018.
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.
(0 Prepare a post-closing trial balance, and determine whether the subsidiary ledgers agree with the control accounts in the general ledger.