Problem

This problem is a continuation of Problem 8.1B.INSTRUCTIONS1. Set up an accounts payable s...

This problem is a continuation of Problem 8.1B.

INSTRUCTIONS

1. Set up an accounts payable subsidiary ledger for Eskimo Ski Shop. Open an account for each of the creditors listed below and enter the balances as of May 1, 2013. Arrange the accounts payable ledger in alphabetical order.
2. Post the individual entries from the purchases journal and the general journal prepared in Problem 8.1B.
3. Prepare a schedule of accounts payable for May 31.
4. Check the total of the schedule of accounts payable against the balance of the Accounts Payable account in the general ledger. The two amounts should be equal.

Analyze: What amount did Eskimo Ski Shop owe to its supplier, East Coast Snow Shop, on May 31?

Problem 8.1B

Eskimo Ski Shop is a retail store that sells ski equipment and clothing. The firm’s credit purchases and purchases returns and allowances during May 2013 follow, along with the general ledger accounts used to record these transactions. The balance shown in Accounts Payable is for the beginning of May.

INSTRUCTIONS

1. Open the general ledger accounts and enter the balance of Accounts Payable for May 1, 2013.
2. Record the transactions in a three-column purchases journal and in a general journal. Use 15 as the page number for the purchases journal and 38 as the page number for the general journal.
3. Post the entries from the general journal to the proper general ledger accounts.
4. Total and rule the purchases journal as of May 31.
5. Post the column totals from the purchases journal to the proper general ledger accounts.
6. Compute the net purchases of the firm for the month of May.

GENERAL LEDGER ACCOUNTS

205	Accounts Payable, $21,608 Cr.
501	Purchases
502	Freight In
503	Purchases Returns and Allowances

DATE	TRANSACTIONS
May 1	Purchased ski boots for $5,600 plus a freight charge of $120 from East Coast Snow Shop, Invoice 6572, dated April 28; the terms are 45 days net.
8	Purchased skis for $12,500 from May-Day Ski Shop, Invoice 4916, dated May 2; the terms are net payable in 30 days.
9	Received Credit Memorandum 155 for $1,250 from East Coast Snow Shop for damaged ski boots that were returned; the boots were originally purchased on Invoice 6572, dated April 28.
12	Purchased ski jackets for $5,000 from Fashion Ski Wear, Invoice 986, dated May 11, net due and payable in 60 days.
16	Purchased ski poles for $2,650 from May-Day Ski Shop, Invoice 5011, dated May 15; the terms are n/30.
22	Purchased ski pants for $3,160 from Winter Sports Clothing, Invoice 4019, dated May 16; the terms are 1/10, n/60.
28	Received Credit Memorandum 38 for $380 from May-Day Ski Shop for defective ski poles that were returned; the items were originally purchased on Invoice 5011, dated May 15.
31	Purchased sweaters for $3,630 plus a freight charge of $220 from Golden Skis & Clothing, Invoice 8354, dated May 27; the terms are 2/10, n/30.

(Note: Save your working papers for use in Problem 8.2B.)

Analyze: What total accounts payable were posted from the purchases journal to the general ledger for the month?

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Solutions For Problems in Chapter 8

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