Acct 11 Chapter 6 Review
1. Tracey Sullivan begins business on May 1, 2005, with the following assets and liabilities:
Cash, $5 000;
Accounts Receivable from Atkinson & Sons, $500
Land, $40 000
Building, $100 000
Office Equipment, $6 800
A/P - Statton Builders, $2 000
Mortgage on Building, $50 000
Record the opening entry for Tracey Sullivan in the two-column general journal.
2. Indicate whether the following statements are true or false.
b) / The ledger is often called the book of original entry. – the journal
c) / When a company issues a sales invoice to a customer, this invoice becomes a purchase invoice in the customer’s books.
d) / At least three accounts are affected by a compound journal entry.
e) / For all bank debit memos received, the accounting entry will be a debit to Bank.
The entry will be a credit to Bank.
f) / A ruled book in which accounting entries are recorded in the order in which they occur is called a journal.
g) / When recording a journal entry, the credit amounts are recorded first. - debits
h) / A bank debit memo, initiated by the bank, will increase the Bank account - decrease
i) / A computerized sales register for cash sales is called a point of sale (POS) terminal
j) / A cash receipt is a business form representing a purchase of goods on account. purchase invoice
3. Analyze the following summary. Ignore GST and PST and complete the chart.
Nature of Transaction / Source Document / Account Debited / Account Credited
1. Cash payment on hydro bill that arrived today
2. Cash sale
3. Bank interest earned
4. Sale on account
5. Purchased advertising on account
4. Dean Hemiston paid $585.36, including 8 per cent sales tax, for some equipment.
a) Calculate the price of the supplies before the sales tax was added. Show your work.
b) Calculate the sales tax on the goods. Show your work.
5. Answer the questions below about this source document:
a) What type of source document is this?
b) What is the purpose of the source document?
c) Who issued it?
d) Give the accounting entry the sender of the source document would make.
General JournalDate / Particulars / P.R. / Debit / Credit
e) Give the accounting entry the receiver of the source document would make.
General JournalDate / Particulars / P.R. / Debit / Credit
6. Complete the following schedule of GST data.
End of Period / GST Recoverable / GST Payable / Amount of Remittance / Refund Claimed / Due DateOct. 31 / 1 025.96 / 988.36
May 31 / 5 514.23 / 9 633.54
Nov. 30 / 215.63 / 664.25
7. Jack Whitcombe and Sons is a consultant engineering firm. The accounts for the firm are as follows:
Bank / A/P—various / Fees EarnedA/R—various / GST Recoverable / Bank Charges
Supplies / GST Payable / Car Expense
Office Equipment / PST Payable / Office Expense
Automobile / J. Whitcombe, Capital / Rent Expense
J. Whitcombe, Drawings / Wages Expense
a. Journalize the transactions shown below in the two-column general journal that follows. Provide explanations for each entry. The next page number of the journal is 16.
b. Calculate and add the GST and PST on all sales transactions. The rate for GST is 7 %, and PST is 8 %. The amount of GST on purchases is given to you; ignore PST on purchases.
Oct. 2 Cash Sales Slip
No. 102 to S. Stewart, $102.50 plus taxes.
6 Sales Invoice
No. 617 to Jack Morrison, $250.90 plus taxes.
10 Cheque Copy
No. 910 to Industrial Suppliers, $500 on account.
12 Cash Receipt
From Jack Mahoney, $322.50 on account.
18 Purchase Invoice
From Grand’s Stationers, $60.50 for office supplies plus GST of 54.24, total $64.74.
20 Cheque Copy
No. 911 to Jack Whitcombe, $525 for personal use.
24 Bank Debit Memo
$31.90 for bank service charge.
30 Cheque Copy
No. 912 to W. Moss, $900 for wages.
31 Cash Sales Slip
No. 103 to J. Beck, $450 plus taxes.
31 Cheque Copy
The balances in the GST accounts for the previous period were: GST Recoverable $770 and GST Payable $1 820. Cheque 913 was written to the Receiver General for $1 050 to clear the accounts for that period.
Date / Particulars / P.R. / Debit / Credit