Enter the transactions in a cash payments journal

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Reference no: EM132722033

Problem - Sam Santiago operates a retail variety store. The books include a cash payments journal and an accounts payable ledger. All cash payments (except petty cash) are entered in the cash payments journal. Selected account balances on May 1 are as follows:

General Ledger

Cash $40,000

Accounts Payable 20,000

Accounts Payable Ledger

Fantastic Toys $5,200

Goya Outlet 3,800

Mueller's Distributors 3,600

Van Kooning 7,400

The following are the transactions related to cash payments for the month of May:

May 1 Issued Check No. 426 in payment of May rent (Rent Expense), $2,400.

May 3 Issued Check No. 427 to Mueller's Distributors in payment of merchandise purchased on account, $3,600, less a 3% discount. Check was written for $3,492.

May 7 Issued Check No. 428 to Van Kooning in partial payment of merchandise purchased on account, $5,500. A cash discount was not allowed.

May 12 Issued Check No. 429 to Fantastic Toys for merchandise purchased on account, $5,200, less a 1% discount. Check was written for $5,148.

May 15 Issued Check No. 430 to City Power and Light (Utilities Expense), $1,720.

May 18 Issued Check No. 431 to A-1 Warehouse for a cash purchase of merchandise, $4,800.

May 26 Issued Check No. 432 to Goya Outlet for merchandise purchased on account, $3,800, less a 2% discount. Check was written for $3,724.

May 30 Issued Check No. 433 to Mercury Transit Company for freight charges on merchandise purchased (Freight-In), $1,200.

May 31 Issued Check No. 434 to Town Merchants for a cash purchase of merchandise, $3,000.

Required -

1. Enter the transactions in a cash payments journal. Total, rule, and prove the cash payments journal.

2. Post from the cash payments journal to the general ledger and accounts payable ledger. Use general ledger account numbers as shown in the chapter.

Reference no: EM132722033

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