Prepared the General Journal entries and the General Ledger entries.
Requirements -
The ending balances for the general ledger, subledgers, and perpetual inventory items as of March 31, 2018, have been entered.
The transactions in source document form, for April 2018, are presented starting on page 16.
Unless otherwise directed by your instructor, you should complete the practice set in the following order.
1. Journalize - Analyze the document for each transaction and record each (journalize) in the appropriate journal as discussed earlier.
You will record sales and returns, purchase goods and services and add HST to invoices and cheques as indicated.
You will compare customer records to cheques received to decide if cash discounts (for paying within 10 days, plus the grace period) are applicable. You will also decide if cash discounts are to be taken when paying your suppliers.
2. a) If you are using s ecia1 journals with group total posting and one general journal, follow these instructions.
Posting - Based on the entries that you made in the journals, post to the ledger accounts and subsidiary accounts as follows:
i) Daily posting - post the individual amounts from the accounts receivable and accounts payable columns to the accounts receivable and accounts payable subledgers. If inventory items are being purchased or sold, post the number of items and the average cost (the average cost may need to be recalculated if the purchase price is different than the previous average cost). Refer to Appendix E on page 65, for information on calculating the Average Cost of Inventory.
ii) Daily postings - post any amount in the other column(s) to the General Ledger accounts.
iii) End of month - total all journals to ensure they are in balance. Debits equal credits.
iv) End of month - post the applicable special journal totals to the General Ledger accounts.
When posting, cross-reference the journal page number and the ledger account number, respectively, in the posting reference column (PR) of the ledger and special journals. Use Customer (C) and Supplier (S) numbers as shown in the subledgers to indicate posting to the subledger.
If you are using perpetual inventory records, cross reference the journal page number with the posting reference column (PR) of the ledger and inventory records.
Individual inventory amounts are to be posted to the Inventory Subledger directly from the purchase invoices.
A checkmark I should be used in the Journal column inven Post Ref to indicate posting to the Inventory subledger.
b) If you are using general Journals with individual postings for each transaction, post each transaction to the general ledger and when required to the accounts receivable, accounts payable and inventory subledgers (refer to Appendix E, page 65).
When posting, cross-reference the journal page number and the ledger account number, respectively, in the posting reference column (PR) of the ledger and general journals. Use Customer (C) and Supplier (S) numbers as shown in the subledgers to indicate posting to the subledger.
3. a) Trial Balance:
Prepare an April 30, 2018 trial balance before calculating any adjusting entries. This trial balance can be prepared on the blank worksheet provided on page 54. You may also prepare the trial balance and complete the worksheet using the Excel worksheet.
Continue with adjusting entries only when the trial balance has equal total debit and credit amounts.
b) Complete the worksheet adjustment columns by using the data supplied by memos on April 30. Complete the worksheet by extending each amount to the income statement and balance sheet columns.
4. Prepare schedules of accounts receivable, accounts payable and inventory, on the forms provided. Balance these amounts to the general ledger control accounts.
5. Financial Statements - prepare the following statements on the forms provided.
a) Income statement for the period January 1 to April 30 with cost of goods section. The year-to-date amounts are from the general ledger.
b) Statement of Changes in Owner's Equity for period January 1 to April 30.
c) Balance Sheet, as at close of business, April 30.
6. Journalize the adjusting entries from the worksheet in the general journal, and post to the general ledger.
7. Your instructor may require you to prepare a trial balance after the adjusting entries have been posted to ensure the accuracy of your data.
8. Calculate the ratios on page 59. Compare them to the ratios at March 31.
- Current Ratio
- Acid Test Ratio
- Gross Profit Ratio
- Expense Ratio
- Net Profit Ratio
- Merchandise Turnover
- Return on Equity
- Debt Ratio
9. Your instructor may require you to complete a bank reconciliation. See Appendix B and C.
Assignment Files -
https://www.dropbox.com/s/6z9vhonc2j6biqr/Assignment%20Files.rar?dl=0