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Transactions related to revenue and cash receipts completed by Crowne Business Services
Co. during the period April 2–30 are as follows:
Apr. 2. Issued Invoice No. 793 to Ohr Co., $4,680.
5. Received cash from Mendez Co. for the balance owed on its account.
6. Issued Invoice No. 794 to Pinecrest Co., $1,990.
13. Issued Invoice No. 795 to Shilo Co., $3,450.
Post revenue and collections to the
15. Received cash from Pinecrest Co. for the balance owed on April 1.
16. Issued Invoice No. 796 to Pinecrest Co., $5,500.
Post revenue and collections to the accounts receivable subsidiary ledger.
19. Received cash from Ohr Co. for the balance due on invoice of April 2.
20. Received cash from Pinecrest Co. for balance due on invoice of April 6.
22. Issued Invoice No. 797 to Mendez Co., $7,470.
25. Received $3,200 note receivable in partial settlement of the balance due on the
Shilo Co. account.
Apr. 30. Received cash from fees earned, $12,890.
Post revenue and collections to the accounts receivable subsidiary ledger.
Instructions
1. Insert the following balances in the general ledger as of April 1:
11 Cash $11,350
12 Accounts Receivable 14,830
14 Notes Receivable 6,000
41 Fees Earned —
2. Insert the following balances in the accounts receivable subsidiary ledger as of
April 1:
Mendez Co. $8,710
Ohr Co. —
Pinecrest Co. 6,120
Shilo Co. —
3. Prepare a single-column revenue journal (p. 40) and a cash receipts journal (p. 36).
Use the following column headings for the cash receipts journal: Fees Earned Cr.,
Accounts Receivable Cr., and Cash Dr. The Fees Earned column is used to record cash
fees. Insert a check mark (✓) in the Post. Ref. column when recording cash fees.
4. Using the two special journals and the two-column general journal (p. 1), journalize
the transactions for April. Post to the accounts receivable subsidiary ledger, and insert
the balances at the points indicated in the narrative of transactions. Determine the
balance in the customer’s account before recording a cash receipt.
5. Total each of the columns of the special journals and
totals to the general ledger. Insert account balances after the last posting.
6. Determine that the sum of the customer balances agrees with the accounts receivable
controlling account in the general ledger.
7. Why would an automated system omit postings to a controlling account as performed
in step 5 for Accounts Receivable?
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