ournalize the entries to record the transactions for (1) summit Company and (2) Beartooth Co., assuming that both companies use the periodic inventory system.
ournalize the entries to record the transactions for (1) summit Company and (2) Beartooth Co., assuming that both companies use the periodic inventory system.
ournalize the entries to record the transactions for (1) summit Company and (2) Beartooth Co., assuming that both companies use the periodic inventory system.
I'm having trouble with the following problem from Cengage. I’m getting error messages in the journalizing for Summit Company. Included are the instructions and screenshots of my results. Please help.
The following selected transactions were completed during August between Summit Companyy and Beartooth Co.
Aug
1
Summit Company sold merchandise on account to Beartooth Co., $48,000, term FOB Destination, 2/15, n/eom. The cost of the goods sold was $28,800.
2
Summit Company paid freight of $1,150 for delivery of merchandise sold to Beartooth Co. on August 1.
5
Summit Company sold merchandise on account to Beartooth Co., $66,000, terms FOB shipping point, n/eom. The cost of the goods sold was $40,000.
9
Beartooth Co. Paid freight of $2,300 on August 5 purchase from Summit Company.
15
Summit Company sold merchandise on account to Beartooth Co., $58,700, terms FOB shipping point, n/45. Summit paid freight of $1,675 which was added to the invoice. The cost of the goods sold was $35,000.
16
Beartooth Co. paid Summit Company for purchase of August 1.
20
Summit Company paid Beartooth Co. a cash refund of $1,000 for defective merchandise purchased on August 1. Beartooth Co. kept the merchandise.
31
Beartooth Co. paid Summit Company on account for purchase of August 5.
31
Summit Company issue Beartooth Co. a credit memo for merchandise with an invoice amount of $4,000 that was returned from the August 15 sale. The cost of the merchandise returned was $2,500.
Journalize the entries to record the transactions for (1) summit Company and (2) Beartooth Co., assuming that both companies use the periodic inventory system. Refer to the Chart of Accounts of the appropriate company for exact wording of account titles.
Chart of Accounts
Summit Company
General Ledger
ASSETS
REVENUE
110 Cash
410 Sales
121 Accounts Receivable-Beartooth Co.
610 Interest Revenue
125 Notes Receivable
EXPENSES
130 Inventory
510 Purchases
131 Estimated Returns Inventory
511 Purchases Returns and Allowances
140 Office Supplies
512 Purchases Discounts
141 Store Supplies
513 Freight In
142 Prepaid Insurance
521 Delivery Expense
192 Store Equipment
522 Advertising expense
193 Accumulated depreciation-store equipment
524 Depreciation expense-store equipment
194 Office equipment
525 Depreciation expense-office equipment
195 Accumulated depreciation-office equipment
526 Salaries Expense
LIABILITIES
531 Rent Expense
210 Accounts Payable
533 Insurance Expense
216 Salaries Payable
534 Store Supplies Expense
218 Sales Tax Payable
535 Office Supplies Expense
219 Customer Refunds Payable
536 Credit Card Expense
221 Notes Payable
539 Miscellaneous Expense
EQUITY
710 Interest Expense
310 Common Stock
311 Retained Earnings
312 Dividends
CHART OF ACCOUNTS
Beartooth Co.
General Ledger
ASSETS
REVENUE
110
Cash
410
Sales
120
Accounts Receivable
610
Interest Revenue
125
Notes Receivable
EXPENSES
130
Inventory
510
Purchases
140
Office Supplies
511
Purchases Returns and Allowances
141
Store Supplies
512
Purchases Discounts
142
Prepaid Insurance
513
Freight In
180
Land
521
Delivery Expense
192
Store Equipment
522
Advertising Expense
193
Accumulated Depreciation-Store Equipment
524
Depreciation Expense-Store Equipment
194
Office Equipment
525
Depreciation Expense-Office Equipment
195
Accumulated Depreciation-Office Equipment
526
Salaries Expense
LIABILITIES
531
Rent Expense
211
Accounts Payable-Summit Company
533
Insurance Expense
216
Salaries Payable
534
Store Supplies Expense
218
Sales Tax Payable
535
Office Supplies Expense
219
Customer Refunds Payable
536
Credit Card Expense
221
Notes Payable
539
Miscellaneous Expense
EQUITY
710
Interest Expense
310
Common Stock
311
Retained Earnings
312
Dividends
Transcribed Image Text:**Journal Entry Records - Summit Company**
| Date | Account | Debit ($) | Credit ($) | Remarks |
|-----------|------------------------------------------|-------------|-------------|------------|
| Aug. 9 | *No entry* | | | |
| Aug. 15 | Accounts Receivable-Bear Tooth Co. | 58,700.00 | | ✔ |
| | Sales | | 58,700.00 | ✔ |
| Aug. 15 | Accounts Receivable-Bear Tooth Co. | 1,675.00 | | ✔ |
| | Cash | | 1,675.00 | ✔ |
| Aug. 16 | Cash | 47,040.00 | | ✔ |
| | Accounts Receivable-Bear Tooth Co. | | 47,040.00 | ✔ |
| Aug. 20 | Customer Refunds Payable | | 1,000.00 | ✔ |
| | Cash | 1,000.00 | | ✔ |
| Aug. 31 | Cash | 66,000.00 | | ✔ |
| | Accounts Receivable-Bear Tooth Co. | | 66,000.00 | ✔ |
| Aug. 31 | Customer Refunds Payable | 4,000.00 | | ✔ |
| | Accounts Receivable-Bear Tooth Co. | | 4,000.00 | ✔ |
**Explanation:**
This table presents the journal entries for Summit Company across a series of transactions in August. Each entry includes the date, accounts affected, and the amounts debited and credited.
**Key Points:**
1. **No Entry:** No transactions were recorded on August 9.
2. **Accounts Receivable and Sales:** On August 15, revenue from Bear Tooth Co. is recognized, increasing Accounts Receivable and Sales.
3. **Collections and Payments:** Entries document the collection of cash or payments made, adjusting respective Accounts Receivable, Cash, or Payable accounts.
4. **Refunds and Adjustments:** Refund adjustments are recorded on August 20 and 31, affecting Customer Refunds Payable and
Transcribed Image Text:**Journal - Summit Company**
**Score:** 228/251
---
**Journal Entries:**
- **Date:** Aug. 1
- **Description:**
- Accounts Receivable - Beartooth Co.
- Sales
- **Debit:** $47,040.00
- **Credit:** $47,040.00
- **Accounting Equation Impact:** Assets ↑, Equity ↑
- **Date:** Aug. 2
- **Description:**
- Delivery Expense
- Cash
- **Debit:** $1,150.00
- **Credit:** $1,150.00
- **Accounting Equation Impact:** Assets ↓, Equity ↓
- **Date:** Aug. 5
- **Description:**
- Accounts Receivable - Beartooth Co.
- Sales
- **Debit:** $66,000.00
- **Credit:** $66,000.00
- **Accounting Equation Impact:** Assets ↑, Equity ↑
- **Date:** Aug. 9
- **Description:** No Entry
- **Comments:** Entries missing for this date, indicated in shaded cells.
- **Date:** Aug. 15
- **Description:**
- Accounts Receivable - Beartooth Co.
- Sales
- **Debit:** $58,700.00
- **Credit:** $58,700.00
- **Accounting Equation Impact:** Assets ↑, Equity ↑
- **Description:**
- Accounts Receivable
- Cash
- **Debit:** $1,675.00
- **Credit:** $1,675.00
- **Accounting Equation Impact:** Assets ↓
- **Date:** Aug. 16
- **Description:** Cash
- **Debit:** $47,040.00
**Graph/Diagram: Accounting Equation Impact**
- **Assets:**
- Arrows indicate increase or decrease.
- **Liabilities:**
- No changes noted in the entries.
- **Equity:**
- Arrows indicate increase or decrease based on the entries.
**Notes:**
- The journal highlights the movement of assets and equity in response to transactions.
- Missing entries on August 9 are colored differently to draw attention.
- The impact on the accounting equation is noted with arrows to indicate direction.
Definition Definition Method of recording financial transactions in the book of original entry by debiting and crediting the accounts affected by a transaction using the golden rules of accrual accounting.
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