CRPII(2) – Mills sporting Goods store – College Accounting – Comprehensive Review Problem II – paradigm 5th edition

QUESTION

College Accounting- Comprehensive Review Problem II –
paradigm 5th edition

Mills Sporting Goods Store -College
Accounting – Comprehensive Review Problem II – paradigm 5th edition

You have now completed the accounting cycle for a merchandising business
and are ready to try to put it all together in this second comprehensive review
problem.
You are keeping the accounting records for Cindi Mills, owner of Mills
Sporting Goods Store. You begin with the balances in her accounts and go
through the accounting cycle for two months.
Directions:
1. Open accounts in the general ledger
with the following balances as of January 1, 20X1
Account Balance
111 Cash $6,560
112 Accounts
Receivable 2,955
113 Office
Supplies 825
114 Store
Supplies 1,915
115 Merchandise
Inventory 13,540
116 Prepaid
Insurance 750
121 Office
Equipment 9,500
121.1 Accumulated
Depreciation-Office
Equipment 2,600
122 Store
Equipment 16,600
122.1 Accumulated
Depreciation-Store
Equipment 4,000
123 Delivery
Equipment 13,000
123.1 Accumulated
Depreciation-Delivery Equipment 7,000
211 Accounts
Payable 3,880
311 Cindi
Mills,
Capital 48,165
312 Cindi
Mills, Drawing
313 Income
Summary
411 Sales
412 Sales
Returns and Allowances
413 Sales
Discounts
511 Purchases
512 Purchases
Returns and Allowances
513 Purchases
Discounts
514 Freight
in
611 Salaries
Expense
612 Rent
Expense
613 Utilities
Expense
614 Office
Supplies Expense
615 Store
Supplies Expense
616 Insurance
Expense
617 Depreciation
Expense-Office Equipment
618 Depreciation
Expense-Store Equipment
619 Depreciation
Expense-Delivery Equipment

2. Open accounts in the accounts receivable ledger
with the following balances as of January 1, 20X1:
Customer
Name Balance
Henry
Galvin $1,025
Lee
Maddox 755
Neagle Co. 1,175
Smitz,
Inc -0-

3. Open accounts in the accounts payable ledger with
the following balances as of January 1, 20X1:
Creditor Name Balance
W. Bedford
Co. $1,365
Jones
Co. -0-
Lemke
Brothers 1,540
Wohlers,
Inc. 975

4.Record the January transactions in a general journal (page 12), a one
column sales journal (page26), a purchases journal (page 10), a five-column
cash receipts journal (page 11), or a four column cash payments journal (page
9). All credit sales carry terms of 2/10, n/30. Freight on all purchases is
charged to the freight in account.
20X1
January
2 Paid rent
for the month, $1.070,
Check No. 234
2 Sold
merchandise to Smitz, Inc., $765,
Invoice No. 176
4 Collected
the balance due from Henry Galvin, less 2% discount
5 Sold
merchandise to Henry Galvin, $1,670,
Invoice No. 177
6 Collected
the balance due from Neagle Co., less 2% discount
7 Issued a
credit memorandum to Henry Galvin for the return of defective merchandise sold
on January 5, $210
7 Purchased
merchandise from Lemke Brothers, $1,045;
terms 2/10,n/30; Invoice No. 187
8 Paid W.
Bedford Co. the balance due, less 2% discount; Check No. 235
9 Paid
Wohlers, Inc., the balance due, less 1% discount; Check No. 236
10 Returned defective
merchandise purchased on January 7 from Lemke Brothers, receiving a credit
memorandum for $105
10 Collected the balance
due from Lee Maddox, Less 2% discount
11 Paid Lemke Brothers
the January 1 balance; no discount; Check No 237
12 Received a check from
Smitz, Inc., for the amount due from the sale of January 2
14 Purchased merchandise
from Jones Co. $2,550; terms,
2/10,n/30; Invoice No. 188
15 Received a check from
Henry Galvin for the amount due from the sale of January 5, less the return of
January 7
15 Recorded cash sales
for the first half of January, $1,665
15 Cindi invested an
additional$3,000 cash in
the firm
16 Purchased office
equipment from Wohlers, Inc., $4,400;
terms, 2/30,n/60 Invoice No. 189
17 Sold merchandise to
Lee Maddox, $950, Invoice
No. 178
17 Paid Lemke Brothers
the amount due from the purchase of January 7, less the return of January 10;
Check No. 238
18 Purchased office
supplies from W. Bedford Co., $860;
terms, n/30; Invoice No. 190
19 Returned defective
office supplies to W. Bedford Co., receiving a credit memorandum for $110
20 Purchased store
supplies from Jones Co.,$555;
terms, n/30; Invoice No. 191
22 Cindi invested a used
truck valued at $4,700 in
the business
23 Sold merchandise to
Neagle Co., $820, Invoice No.
179
24 Paid the balance due
to Jones Co. from the purchase of January 14; Check No. 239
24 Cindi wrote check No.
240 to pay her home phone bill, $205
25 Sold Merchandise to
Smitz, Inc., $1,995,
Invoice No. 180
26 Sold store supplies to
another firm at cost for cash, $110
27 Issued a credit
memorandum to Smitz, Inc., for a shortage from the sale of January 25, $75
27 Purchased merchandise
from Jones Co., $750;
terms, 2/10,n/30; Invoice No. 192
29 Paid January’s
electric bill, $595, Check
No. 241
31 Recorded cash sales
for the second half of January, $2,445
31 Paid freight on
January purchases, $450,
Check No. 242
31 Paid salaries for
January, $4,450, Check No.
243

5. Total all special journals

6. Post all items that need to be posted

7. Prepare a trial balance on a work sheet as of January 31, 20X1

8. Prepare schedules of accounts receivable and accounts payable

9. Complete the worksheet. Adjustment data for January 31 are as follows:
(a)
Office Supplies on hand, $830
(b)
Store Supplies on hand, $750
(c)
Insurance Expired, $20
(d)
Depreciation of office equipment, $90
(e)
Depreciation of store equipment, $125
(f)
Depreciation of delivery equipment, $250
(g)
Merchandise Inventory (beginning), $13,540
(h)
Merchandise Inventory (ending), $12,210

10.Record and post adjusting entries as of January 31.

11. Record and post closing entries as of January 31.

12. Prepare a January 31 post-closing trial balance.

13. Prepare an income statement for the month of January. All salaries
are sales salaries.

14. Prepare a statement of owner’s equity for the month of January

15. Prepare a January 31 balance sheet

16. Record the following February transactions
20X1
February
1 Paid rent
for the month, $1,070,
Check No. 244
2 Purchased
merchandise from Lemke Brothers, $740;
terms, 2/10,n/30; Invoice No. 193
3 Returned
merchandise purchased from Lemke Brothers on February 2, receiving a credit
memorandum for $75
3 Collected
the balance due from Lee Maddox
4 Collected
the balance due from Smitz, Inc., for the sale of January 25 less the credit of
January 27 and less the 2% discount
5 Cindi took
home $40 of office
supplies for her personal use
6 Sold
merchandise to Henry Galvin, $2,140,
Invoice No. 181
6 Paid Jones
Co. the balance due on purchases of $555 and $750,
less a 2% discount on the $750 purchase;
Check No. 245
7 Collected
the balance due from Neagle Co.
8 Issued a
credit memorandum to Henry Galvin for damaged merchandise sold on February 6, $195
9 Purchased
merchandise for cash, $375,
Check No. 246
11 Paid Lemke Brothers
for the balance due from the purchase of February 2, less the return of
February 3; Check No. 247
11 Returned $20 of the merchandise purchased
on February 9, receiving a cash refund
12 Sold merchandise to
Lee Maddox, $1,185, Invoice
No. 182
13 Cindi wrote Check No.
248 for personal expenses, $350
14 Recorded cash sales
for the first half of the month, $3,095
15 Paid Wohlers, Inc.,
the balance due, less 2% discount, Check No. 249
16 Received a check from
Henry Galvin for the amount due from the sale of February 6, less the return of
February 8
17 Sold office supplies
for cash, $85
17 Paid W. Bedford Co.
the balance due for the purchase of January 18, less the return of January 19;
Check No. 250
19 Purchased store
supplies from W. Bedford Co. $340;
terms, n/30; Invoice No. 194
20 Returned $30 of the store supplies
purchased on February 19, receiving credit
21 Purchased merchandise
from Lemke Brothers, $940;
terms, 2/10,n/30; Invoice No. 195
22 Sold merchandise to
Neagle Co., $1,095; Invoice
No. 183
24 Purchased merchandise
from Jones Co., $1,045;
terms, 2/10,n/30; Invoice No 196
25 Sold merchandise to
Smitz, Inc., $1,755,
Invoice No. 184
26 Purchased store
equipment from Wohlers, Inc., $2700;
terms 2/30,n/60; Invoice No. 197
27 Paid the electric bill
for February, $550, Check No.
251
28 Recorded cash sales
for the second half of the month, $2,985
28 Paid freight on
February purchases, $435,
Check No. 252
28 Paid salaries for
February, $4,450, Check No.
253

17.Total all special journals.
18. Post all items that need to be posted
19. Prepare a trial balance on a work sheet as of February 28, 20X1
20. Prepare schedules of accounts receivable and accounts payable.
21. Complete the work sheet. Adjustment data for February 28 are as
follows
(a)
Office Supplies on hand, $355
(b)
Store Supplies on hand, $275
(c)
Insurance Expired, $20
(d)
Depreciation of office equipment, $90
(e)
Depreciation of store equipment, $125
(f)
Depreciation of delivery equipment, $250
(g)
Merchandise Inventory (beginning), $12.210
(h)
Merchandise Inventory (ending), $12,780
22.Record and post adjusting entries as of February 28.
23. Record and post closing entries as of February 28.
24. Prepare a February 28 post-closing trial balance.
25. Prepare an income statement for the month of February. All
salaries are sales salaries.
26. Prepare a statement of owner’s equity for the month of February.
27. Prepare a February 28 balance sheet.

Check figures for
January only.
Net Loss:
4,946.75 Total Assets: 57,168.25 Cash Balance: 4,823.25

ANSWER:

REQUEST HELP FROM A TUTOR