Exercise Periodic and Perpetual

University of South East Asia
2014-2015
Exercise Chapter 2
Exercise 1
Correct entries ( periodic inventory system ) the following mistake.
1- Purchase merchandise inventory on account $2,300.
Incorrect journal entries
Date
Account Name
Dr.
2011
Purchase
3,200
Oct. 12
A/P
2- Purchase machine on account $24,000.
Date
Account Name
2011
Purchase
Oct. 12
A/P
Dr.
24,000
3,200
Cr.
24,000
3- Sales merchandise inventory on account $2,500.

Date
Account Name
2011
Cash
Oct. 12
Sales
COGS
Inventory
4- Purchase furniture in cash $2,560.
Date
Account Name
2011
Cash
Oct. 12
Purchase
Dr.
2,500
Cr.
2,500
1,500
1,500
Dr.
5,260
Cr.
5,260
5- Paid insurance for one year $1,200.

Date
Account Name
2011
Insurance expense
Oct. 12
Cash
Dr.
1,200
Cr.
1,200
6- Collected cash from customer $1,600.

Date
Account Name
2011
Cash
Oct. 12
Sales
Lecturer: Hour Ry
Cr.
Dr.
6,100
Cr.
6,100
Exercise Financial Accounting
2014-2015
Exercise 2
Work Sheet
Account
Name
Unadjusted Trial
balance
Dr.
Cr.
Cash
5,000
A/R
3,400
Prepaid insurance
120
Prepaid rent
600
Inventory
Supply
Equipment
80
2,300
10,000
5,000
800
50
Utility expense
250
Repair expense
30
Dep. Exp. equi

Dep. Exp. furniture
Interest expense
22,7
50
Rent expense
Cr.
400
250
1,600
2,300
10,000
300
8,350
400
5,000
200
800
50
250
30
400
5,000
200
800
50
250
30
80
100
50
200
80
100
50
200
22,75
0
80
100
50
200
Interest payable
Insurance expense
Dr.
5,000
3,400
110
550
3,000
20
2,000
1,500
8,350
8,350
Advertising exp
Cr.
300
400
200
Dr.
250
1,600
2,300
10,000
300
Salary expense
Supply expense
50
200
Freight-out
Cr.
Balance
Sheet
400
1,600
Sales
Income
Statement
1,500
Ladys Capital
Total
100
300
1,500
Account payable
COGS
Dr.
5,000
3,400
110
550
3,000
20
2,000
2,000
Notes payable
Sales ret and all
Cr.
10
50
100
Acc. Dep. furniture
Ladys drawing
Dr.
3,000
Acc. Dep. equi

Furniture
Adjusted
Trial Balance
Adjustments
200
200
10
50
10
50
23,100
Total
200
10
50
7,220
1,130
23,100
Net income
TOTAL
8,350
1,130
$15,880
$15,880
Adjusting information
a- Supply on hand totaled $20.
b- Depreciation is $100 on the equipment and $50 on the furniture.
c- Interest of $200 is accrued on notes payable at October 31.
d- Insurance expired $10.
e- Rent expired $50.
1)-Complete the worksheet.
2)- Prepared income statement.
3)- Prepared Owners equity statement.
4)- Prepared balance sheet.
5)- Prepared closing entries.
6)-Prepared Post-trial balance.
Lecturer: Hour Ry
2014-2015
Exercise 3
The following merchandising transactions in the month of October. Old balance Cash $6,000
beginning inventory $4,000 and Capital $10,000.
Oct. 01- Purchased merchandise on account from X of $5,000, terms 2/10,n/60.
02- Sold merchandise on account $4,000, terms 2/10, n/30. The cost of the merchandise
sold was $2,000.
04- Purchase equipment on account $2,000. Useful life 2 years.
05- Received credit from X for merchandise returned $300.
07- Paid insurance $1,200 for one year.
09- Received collections in full, from customers billed on sales on October 2.
10- Paid to X in full amount.
11- Purchased Supplies for cash $200.
12- Purchased merchandise for cash $2,400.
15- Received refund for poor quality merchandise from supplier on cash purchase $330
on October 12.
17- Purchased merchandise from Y $3,000, FOB shipping point, terms 2/10, n/60.
19- Paid freight on October 17 purchase $50.
20- Paid in full amount on October 4.
24- Sold merchandise for cash $4,500. the merchandise sold had a cost of $3,000.
25- Purchased merchandise from Z. $3,000, FOB destination, terms 2/10, n/60.
27- Paid to Y in full amount.
28- Paid utility $200.
29- Made refunds to cash customers for defective merchandise $300. The returned
merchandise had a cost of $200 on October 24.
30- Paid salary to staffs $200
31- Sold merchandise on account $3,600, terms n/60. The cost of the merchandise sold
was $2,200.
Instructions
1-Journalize the transactions using a Perpetual inventory system.
2- Posting the transactions into Ledger.
3-Prepare trial balance October 31.
4-Prepare Financial statement October 31.
5-Closing entries
6-Post-closing trial Balance
Lecturer: Hour Ry
Lecturer: Hour Ry
2014-2015
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University of South East Asia

3- Sales merchandise inventory on account $2,500.

5- Paid insurance for one year $1,200.

6- Collected cash from customer $1,600.

Exercise Financial Accounting

University of South East Asia

Dep. Exp. equi

Sales ret and all

Acc. Dep. furniture

Acc. Dep. equi

Exercise Financial Accounting

University of South East Asia

Exercise Financial Accounting

University of South East Asia

Exercise Financial Accounting

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