Have a homework assignment in accounting

This is requirement for Accounting 212. There are highlighted areas that require extra attention.

Note says “to remember to expand your answer on the explanation questions….I want to see what you know and not just what the textbook is stating”. Applies specifically to questions 12 & 13 and/or any others that may require it.

File to be in Word, or x format.

1.
Explain

why it is important to record credit sales in a sales journal?

And, explain why it is important to then post from the sales journal to the general ledger accounts?

2.
Explain why the following objectives are important to the accounts receivable process:

A.
Post from the sales journal to the customers’ accounts in the accounts receivable subsidiary ledger.

B.
Record sales returns and allowances in the general journal.

C.
Post sales returns and allowances.

D.
Prepare a schedule of accounts receivable.

3.
Explain why the following objectives are important in handling special topics in merchandising:

A.
Computation of trade discounts.

B.
Record credit card sales in appropriate journals.

C.
Prepare the state sales tax return.

4.
Tell me what are some possible consequences of out-of-date accounts receivable records?

5.
Explain completely and compute the following, showing your work and how you arrived at the answer:

A.
What are the four types of credit sales?

B.
What account is used to record sales tax owed by a business to a city or state?

C.
What is the difference between list price and net price?

D.
If a wholesale business offers a trade discount of 30 percent on a sale of $6,325, what is the amount of the discount?

E.
An organization that purchases $4,500 of goods from a wholesaler offering trade discounts of 25 and 15 percent will pay what amount for the goods?

F.
Imagine you own a business, and you are thinking about extending credit to customers to increase sales. What factors would you consider in deciding whether or not to extend credit to a customer?

6.
Compute the following, showing all work to arrive at your answer:

Sales Journal

4/25/2003

Date	Sales Slip #	Customer’s Account Debited	Accounts Receivable Debit	Sales Tax Payable Credit	Sales Credit
	4/25/2003	4100	Sara Siddle	$ 321.00	$ 21.00	$ 300.00
4101	Jesse James	$ 427.00	$ 27.00	$ 450.00

All sales recorded in this sales journal were made on account and are taxable at a rate of 6 percent. Explain what errors have been made in the entries? Assume the Sales Credit column is correct.

7. The following transactions took place at Dune Hike and Bike Shop. Indicate the general ledger account numbers that would be debited and credited to record each transaction:

General Journal Accounts

101
Cash

205 Accounts Payable

501 Purchases

502 Freight In

503 Purchases Returns and Allowances

Transactions

A.
Purchased merchandise for $1,000; the terms are 2/10, n/30.

B.
Returned damaged merchandise to a supplier and received a credit memorandum for $200.

C.
Issued a check for $400 to a supplier as a payment on account.

D.
Purchased merchandise for $1,200 plus a freight charge of $130; the

supplier’s invoice is payable in 30 days.

E.
Received an allowance for merchandise that was damaged but can be sold at a reduce price; the supplier’s credit memorandum is for $300.

F.
Purchased merchandise for $2,100 in cash.

8.
Explain to me why it is important to record purchases of merchandise on credit in a three-column purchase journal. And, why is it important to post from the three-column purchases journal to the general ledger accounts?

9.
Describe why an understanding of credit policies and credit terms might help a retail store manager direct the operations of the store more effectively?

10.
Explain to me why the following are important:

A.
Post credit purchases from the purchases journal to the accounts payable subsidiary ledger.

B.
Record purchases returns and allowances in the general journal and post them to the accounts payable subsidiary ledger.

C.
Prepare a schedule of accounts payable.

D.
Compute the net delivered cost of purchases.

E.
Demonstrate a knowledge of the procedures for effective internal control of purchases.

11.
As a manager, what internal controls would you put in your accounting system, based on your knowledge of financial accounting to this point?

12.
An organization has a debit balance of $95, 061 in its Purchases account and a credit balance of $5,520 in its Purchases Returns and Allowances account. Calculate net purchases for the period.
Show all work.

13.
Acme Company receives an invoice that reflects the price of goods as $112,679 and the freight charge as $8,465. How is this transaction recorded?
Show all work.

14.
Explain to me why it is important to record cash receipts in a cash receipts journal, account for cash short or over, and post from the cash receipts journal to subsidiary and general journals?

15.
Explain to me what is a promissory note? In what situation would a business accept a promissory note? Secondly, you notice that the Cash Short or Over account has 19 entries during the month of January. The ending balance is a $55 shortage for the month. Is this a problem? Why or why not?

16.
Why are the following objectives important: Record cash payments in a cash payments journal, post from the cash payments journal to subsidiary and general ledgers, demonstrate a knowledge of procedures for a petty cash fund, and demonstrate a knowledge of internal control routines for cash?

17.
What are discount terms? Then, give me an example of a situation in which discount terms were used.

18.
As a banking customer, what concerns do you have about online banking? What benefits and disadvantages can you identify?

19.
Your employer keeps a $250 petty cash fund. Your boss, Susan Atkins asked you to replenish the fund. Ms. Atkins is missing a receipt for $67.45, which she says she spent on postage. Explain to me how you would handle this situation?

20.
How would you determine how much cash to keep in the business checking account, as opposed to in a short-term investment?