Question

Purchases and Cash Payments Journals; Accounts Payable Subsidiary and General Ledgers Aquafresh Water Testing Service was established on Art 16. Aquafresh uses field equipment and field supplies (chemicals and other supplies) to analyze water for unsafe contaminants in streams, lakes, and ponds Transactions related to purchases and cash payments during the remainder of April are as follows: April 16. Issued Check No. 1 in payment of rent for the remainder of April, 53,500 April 16. Purchased field supplies on account from Hydro Supply Co., 85,340 April 16. Purchased field guipment on account from Pure Equipment Co, 21.450 April 17. Purchased office supplies on account from Best Office Supply Co., 8510 April 19. Issued Check No. 2 in payment of field supplies, $3,340, and office supplies, 5400 Post the journals to the accounts payable subsidiary ledger April 23. Purchased office supplies on account from Best Office Supply Co. 3660 April 23 Issued Check No. 3 to purchase and $140,000 April 24 Issued Check No. 4 to Hydro Supply Co. In payment of April 16 Invoice, 55,340. April 26 Issued Check No. 5 to Pure Equipment Co. in payment of April 16 invoice, 121,450 Post the journals to the accounts payable subsidiary ledger April 30. Acquired and in exchange for field equipment having a cost of $12,000 April 30. Purchased field supplies on account from Hydro Supply Co. 57,650 April 30 Issued Check No. 6 to Best Office Supply Co. in payment of April 17 invoice, 5510 April 30 Purchased the following from Pure Equipment Co. on account:fed supplies, $1,340, and field equipment, 4.700 April 30 Issued Check No. 7 in payment of salaries, $29.400 Post the journals to the accounts payable subsidiary ledger

Answer 1

Answer :

1., 2., and 3.

PURCHASES JOURNAL Page Post. Ref. Accounts Payable Cr. Field Supplies Dr. Office Supplies Dr. Other Accounts Dr. Post. Ref. Account Credited Amount Date 2016 April ✓ 5,340 ✓ Field Equipment 17 21,450 ✓ 16 Hydro Supply Co. 16 Pure Equipment Co. 17 Best Office Supply Co. 23 Best Office Supply Co. 30 Hydro Supply Co. 30 Pure Equipment Co. 30 510 660 ✓ 5,340 21,450 510 660 7,650 6.040 41,650 (21) ✓ ✓ Field Equipment 17 7,650 1,340 14,330 (14) 4,700 26,150 1,170 (15)

CASH PAYMENTS JOURNAL Page 1 Post. Ck. No. Other Accounts Dr. Accounts Payable Dr. Cash Cr. Date Account Debited Ref. 2016 April 1 16 19 N 71 14 15 19 3,500 3,340 400 140,000 23 3 24 4 26 5 30 6 7 30 Rent Expense Field Supplies Office Supplies Land Hydro Supply Co. Pure Equip. Co. Best Office Supply Co. Salary Expense Total 5,340 21,450 510 3,500 3,340 400 140,000 5,340 21,450 510 29,400 203,940 (11) 30 61 29,400 176,640 () 27,300 (21)

1. and 2.

JOURNAL Page 1 Post. Ref. Description Debit Credit Date 2016 April 12,000 30 Land Field Equipment 19 17 12,000

1.

ACCOUNTS PAYABLE SUBSIDIARY LEDGER Best Office Supply Co. Name: Post. Ref. Item Debit Credit Balance Date 2016 April 17 23 30 P1 P1 CP1 510 660 510 1,170 660 510 Name: Hydro Supply Co. Post. Ref. Item Debit Credit Balance Date 2016 April 5,340 5,340 16 24 30 P1 CP1 P1 5,340 7,650 7,650 Name: Pure Equipment Co. Post. Ref. Item Debit Credit Balance Date 2016 April 21,450 21,450 16 26 30 P1 CP1 P1 21,450 6,040 6,040

2 and 3.

GENERAL LEDGER Account: Cash Account No. 11 Post. Ref. Balance Debit Credit Item Debit Credit Date 2016 April 30 CP1 203,940 203,940 Account: Field Supplies Account No. 14 Post. Ref. Balance Debit Credit Item Debit Credit Date 2016 April 19 30 CP1 P1 3,340 14,330 3,340 17,670 Account: Office Supplies Account No. 15 Post. Ref. Balance Debit Credit Item Debit Credit Date 2016 April 19 30 CP1 P1 400 1,170 400 1,570 Account: Field Equipment Account No. 17 Post. Ref. Balance Debit Credit Item Debit Credit Date 2016 April 16 30 30 P1 P1 J1 21,450 4,700 21,450 26,150 14,150 12,000 Account: Land Account No. 19 Post. Ref. Balance Debit Credit Item Debit Credit Date 2016 April 23 30 CP1 J1 140,000 12,000 140,000 152,000

Account: Accounts Payable Account No. 21 Post. Balance Debit Credit Item Ref. Debit Credit Date 2016 April 30 30 41,650 P1 CP1 41,650 14,350 27,300 Account: Salary Expense Account No. 61 Post. Ref. Balance Debit Credit Item Debit Credit Date 2016 April 30 CP1 29,400 29,400 Account: Rent Expense Account No. 71 Post. Ref. Balance Debit Credit Item Debit Credit Date 2016 April 16 CP1 3,500 3,500

4.

AQUAFRESH WATER TESTING SERVICE Accounts Payable Creditor Balances April 30, 2016 Best Office Supply Co. Hydro Supply Co. Pure Equipment Co. Total accounts payable* $ 660 7,650 6,040 $14,350

* The total of the schedule of accounts payable is equal to the balance of the accounts
payable control account.

5. A subsidiary ledger for the field equipment would allow the company to track each individual piece of equipment with respect to cost, location, useful life, and other data. Such information would be useful for safeguarding equipment and determining depreciation.