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Open the general ledger accounts and enter the balances for October 1, 20X1

Accounting

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Open the general ledger accounts and enter the balances for October 1, 20X1. Obtain the necessary figures from the postclosing trial

balance prepared on September 30, 20X1, which is shown below. (If you are using the Study Guide & Working Papers, you will find that

the general ledger accounts are already open.)

 

2. Open the subsidiary ledger accounts and enter the balances for October 1, 20X1. Obtain the necessary figures from the schedule of

accounts payable and schedule of accounts receivable prepared on September 30, 20X1, which appears below. (If you are using the Study

Guide & Working Papers, you will find that the subsidiary ledger accounts are already open. )

 

3. Analyze the transactions for October and record each transaction in the proper journal. (Use 10 as the number for the first page of each

special journal and 16 as the number for the first page of the general journal.)

 

4. Post the individual entries that involve customer and creditor accounts from the journals to the subsidiary ledgers on a daily basis. Post

the individual entries that appear in the general journal and in the Other Accounts sections of the cash receipts and cash payments

journals to the general ledger on a daily basis.

 

5. Total, prove, and rule the special journals as of October 31, 20X1.

 

6. Post the column totals from the special journals to the general ledger accounts.

 

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7. Check the accuracy of the subsidiary ledgers by preparing a schedule of accounts receivable and a schedule of accounts Page 507

payable as of October 31, 20X1. Compare the totals with the balances of the Accounts Receivable account and the Accounts TT

Payable account in the general ledger.

 

8. Check the accuracy of the general ledger by preparing a trial balance in the first two columns of a 10-column worksheet. Make sure that

the total debits and the total credits are equal.

 

9. Complete the Adjustments section of the worksheet. Use the following data. Identify each adjustment with the appropriate letter.

 

a. During October, the firm had net credit sales of $10,140. From experience with similar businesses, the previous accountant

had estimated that 1.0 percent of the firm’s net credit sales would result in uncollectible accounts. Record an adjustment for

the expected loss from uncollectible accounts for the month of October.

 

b. On October 31, an inventory of the supplies showed that items costing $2,740 were on hand. Record an adjustment for the

supplies used in October.

 

c. On September 30, 20X1, the firm purchased a six-month insurance policy for $8,400. Record an adjustment for the expired

insurance for October.

 

d. On October 1, 20X1, the firm signed a three-month advertising contract for $5,100 with a local cable television station and l

paid the full amount in advance. Record an adjustment for the expired advertising for October.

 

e. On April 1, 20X1, the firm purchased equipment for $83,000. The equipment was estimated to have a useful life of five years

and a salvage value of $12,500. Record an adjustment for depreciation on the equipment for October.

 

f.-g. | Based ona physical count, ending merchandise inventory was determined to be $82,260.

 

10. Complete the Adjusted Trial Balance section of the worksheet.

 

11. Determine the net income or net loss for October and complete the worksheet.

 

12. Prepare a classified income statement for the month ended October 31, 20X1. (The firm does not divide its operating expenses into

selling and administrative expenses. )

 

13. Prepare a statement of owner's equity for the month ended October 31, 20X1.

 

14. Prepare a classified balance sheet as of October 31, 20X1.

 

15. Journalize and post the adjusting entries using general journal page 17.

 

16. Prepare and post the closing entries using general journal page 18.

 

17. Prepare a postclosing trial balance. "Page 508