Question

At the beginning of the new​ year, Nature Gnome Company decided to carry and sell​ T-shirts with its logo printed on them. Nature Gnome Company uses the perpetual inventory system to account for the inventory. During January 2019​, Nature Gnome Company completed the following merchandising​ transactions:

Jan. 1 2 3 7 8 Purchased 5 T-shirts at $6 each and paid cash Sold 3 T-shirts for $13 each, total cost of $18. Received cash. Purchased 110 T-shirts on account at $8 each. Terms 4/10, n/30. Paid the supplier for the T-shirts purchased on January 3, less discount. Realized 2 T-shirts from the January 1 order were printed wrong and returned them for a cash refund Sold 80 T-shirts on account for $13 each, total cost of $640. Terms 3/15, 10 12 Received payment for the T-shirts sold on account on January 10, less discount. 14 Purchased 120 T-shirts on account at $6 each. Terms 2/15, n/30. 18 Nature Gnome Company called the supplier from the January 14 purchase and told them that some of the T-shirts were the wrong color. The supplier offered a $90 purchase allowance. Paid the supplier for the T-shirts purchased on January 14, less the 20 21 23 25 allowance and discount. Sold 80 T-shirts on account for $13 each, total cost of $468. Terms 5/20, Received a payment on account for the T-shirts sold on January 21, less discount. Purchased 380 T-shirts on account at $8 each. Terms 4/10, n/30, FOB shipping point. Paid freight associated with the January 25 purchase, $38. Paid for the January 25 purchase, less discount. Sold 200 T-shirts on account for $13 each, total cost of $1,365. Terms 5/10, n/30. Received payment for the T-shirts sold on January 30, less discount. 27 29 30 31

Enter the transactions in a sales journal​ (page 2), a cash receipts journal​ (page 5, omit Sales Discounts Forfeited​ column), a purchases journal​ (page 7), a cash payments journal​ (page 6), and a general journal​ (page 4), as appropriate. Total each column of the special journals. Show that total debits equal total credits in each special journal.

Answer 1

Nature Gnome Company

For the Month of January

Sales Journal

Date	Name	LF	Account Rec	Cost of Goods Sold
10-01	Debtor-1		$1040	$640
21-01	Debtor-2		$1040	$468
30-01	Debtor-3		$2600	$1365
	Total		$4680	$2473

Purchase Journal

Date	Name of Supplier	LF	Account Pay
03-01	Supplier-1		$880
14-01	Supplier-2		$720
25-01	Supplier-3		$3040
	Total		$4640

Cash Receipts Journal

Date	Particular	LF	Amount	Cost of Goods Sold
02-01	Cash sale		39	18
12-01	Rec from Debtor-1		1008.80
23-01	Rec from Debtor-2		988
31-01	Rec from Debtor-3		2470
	Total		$4505.80	$18

Payment Journal

Date	Particular	Amount
01-Jan	Purchase in cash	$30
07-01	Payment to Supplier-1	$844.20
08-01	Payment for sales return	$26
20-01	Payment to Supplier-2	$615.60
27-01	Fright	$38
29-01	Payment to Supplier-3	2918.40
	Total	$4472.20

General Journal

Date	Particular	LF	Amount
07-01	Discount from supplier -1		35.20
12-01	Discount allowed to Debtor-1		(31.20)
14-01	Discount for Default Pur		90
20-01	Discount from supplier -2		14.40
23-01	Discount allowed to Debtor-1		(52)
29-01	Discount from supplier -3		121.60
31-01	Discount allowed to Debtor-1		(130)
	Total		48