Accounting 3.01 Test Study Guide

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Questions and Answers

What is the journal entry for Dollar Arcade to record the transaction of paying cash to Cola Distributors?

Debit Purchases Discount $5 and debit Cash $245; credit Accounts Payable/Cola Distributors $250.

Debit Accounts Payable/Cola Distributors, $245; credit Cash, $245.

Debit Accounts Payable/Cola Distributors, $250; credit Purchases Discount $5 and credit Cash $245. (correct)

Debit Accounts Payable/Cola Distributors, $250; credit Cash, $250.

What is the journal entry for Dipper's Ice Cream Parlor to record the return of merchandise to The Ice Cream Company?

Debit Accounts Receivable/The Ice Cream Company, $600; Credit Purchases Returns and Allowances, $600.

Debit Accounts Payable/The Ice Cream Company, $600; Credit Purchases Returns and Allowances, $600. (correct)

Debit Purchases Returns and Allowances, $600; Credit Purchases, $600.

Debit Purchases Returns and Allowances, $600; Credit Accounts Payable/The Ice Cream Company, $600.

What is the journal entry for Cara's CDs to record the cash payment to Willie's Wholesale?

Debit Cash $595; credit Accounts Receivable/Willie's Wholesale $595.

Debit Cash $595; credit Accounts Payable/Willie's Wholesale $595.

Debit Accounts Receivable/Willie's Wholesale, $595; credit Cash, $595.

Debit Accounts Payable/Willie's Wholesale $595; credit Cash, $595. (correct)

What is the journal entry for Marvin's Motorcycles to record the cash payment for supplies?

Debit Supplies, $125; credit Cash, $125. Signup and view all the answers

What is the journal entry for Wally's Wallets to record the cash payment to Leather Products Supply?

Debit Accounts Payable/Leather Products Supply, $460; credit Purchases Discount $23 and credit Cash $437. Signup and view all the answers

What is the journal entry for Wally's Watches to record the return of merchandise to Timer's Distributing?

Debit Accounts Payable/Timer's Distributing, $400; Credit Purchases Returns and Allowances, $400. Signup and view all the answers

What is the journal entry for Valley Products to record the payment to Carolina Distributors?

Debit Accounts Payable/Carolina Distributors, $900; credit Purchases Discount $18 and credit Cash $882. Signup and view all the answers

What is the journal entry for Terry's Tree Removal to record the cash payment to Sam's Sharpening Service?

Debit Accounts Payable/Sam's Sharpening Service, $750; credit Purchases Discount $15 and credit Cash $735. Signup and view all the answers

What is the journal entry for Betty's Boutique to record the cash purchase from Jackson Supply?

Debit Purchases, $700; credit Cash, $700. Signup and view all the answers

What is the journal entry for River Road Farm Supply to record the payment to C-V Chemical Distributors?

Debit Accounts Payable/C-V Chemical Distributors, $820; credit Purchases Discount $41 and credit Cash $779. Signup and view all the answers

What is the journal entry for Computer Phones, Inc. to record the payment to Software Supply?

Debit Accounts Payable/Software Supply, $860; credit Purchases Discount $43 and credit Cash $817. Signup and view all the answers

What is the journal entry for John's Appliances to record the purchase from Electronic Supply?

Debit Purchases, $990; Credit Accounts Payable/Electronic Supply, $990. Signup and view all the answers

What is the journal entry for Sonny's Skateboard Shop to record the payment on account to Boards Unlimited?

Debit Accounts Payable/Boards Unlimited $795; credit Cash, $795. Signup and view all the answers

Classic Cars, Inc. paid $500 cash for supplies from Wendy's Supplies. What is the journal entry for Classic Cars, Inc. to record this transaction?

Debit Supplies, $500; Credit Cash, $500 Signup and view all the answers

Mike's Music paid cash to Sheet Music Supply, $294; covering Purchase Invoice No. 54 for $300, less a 2% discount, $6.00. What is the journal entry for Mike's Music to record this transaction?

Debit Accounts Payable/ Sheet Music Supply, $300; Credit Purchases Discount $6 and credit Cash $294 Signup and view all the answers

Carl's CDs purchased store supplies on account from Mason Supply for $425. What is the journal entry for Carl's CDs to record this transaction?

Debit Supplies, $425; Credit Accounts Payable/Mason Supply, $425 Signup and view all the answers

Jacob Doe Tractor purchased store supplies on account from Tractor Supply for $942. What is the journal entry for Jacob Doe Tractor to record this transaction?

Debit Supplies, $942; Credit Accounts Payable/Tractor Supply, $942 Signup and view all the answers

Digital Electronics paid $189 cash for supplies from We Deliver Supplies. What is the journal entry for Digital Electronics to record this transaction?

Debit Supplies, $189; Credit Cash, $189 Signup and view all the answers

Jones' Hardware paid $750 cash for supplies from Miner's Supply. What is the journal entry for Jones' Hardware to record this transaction?

Debit Supplies, $750; Credit Cash, $750 Signup and view all the answers

Wanda's Wigs paid cash to Wig Warehouse, $323; covering Purchase Invoice No. 812 for $340, less a 5% discount, $17.00. What is the journal entry for Wanda's Wigs to record this transaction?

Debit Accounts Payable/ Wig Warehouse, $340; Credit Purchases Discount $17 and credit Cash $323 Signup and view all the answers

The Good Morning Shop purchased merchandise on account from The Donut Plant for $300. What is the journal entry for The Good Morning Shop to record this transaction?

Debit Purchases, $300; Credit Accounts Payable/The Donut Plant, $300 Signup and view all the answers

Icy Treats purchased merchandise for cash from Flavor Supply for $100. What is the journal entry for Icy Treats to record this transaction?

Debit Purchases, $100; Credit Cash, $100 Signup and view all the answers

Starz Transport paid cash on account to Avery Aircraft, $995, covering Purchase Invoice No. 1691. What is the journal entry for Starz Transport to record this transaction?

Debit Accounts Payable/ Avery Aircraft $995; Credit Cash, $995 Signup and view all the answers

Billy Bob's B-B-Q paid cash to Pork Distributors, $418; covering Purchase Invoice No. 1921 for $440, less a 5% discount, $22.00. What is the journal entry for Billy Bob's B-B-Q to record this transaction?

Debit Accounts Payable/ Pork Distributors, $440; Credit Purchases Discount $22 and credit Cash $418 Signup and view all the answers

Curt's Cabinets paid cash to Phil's Fasteners, $441; covering Purchase Invoice No. 54 for $450, less a 2% discount, $9.00. What is the journal entry for Curt's Cabinets to record this transaction?

Debit Accounts Payable/ Phil's Fasteners, $450; Credit Purchases Discount $9 and credit Cash $441 Signup and view all the answers

Sluggers Sports Shop purchased merchandise for cash from Better Bats Warehouse for $850. What is the journal entry for Sluggers Sports Shop to record this transaction?

Debit Purchases, $850; Credit Cash, $850 Signup and view all the answers

Gill's Grills purchased store supplies on account from Sellers Warehouse for $829. What is the journal entry for Gill's Grills to record this transaction?

Debit Supplies, $829; Credit Accounts Payable/Sellers Warehouse, $829 Signup and view all the answers

Seahawk Fastpitch Softball paid cash on account to Community Field, $295, covering Purchase Invoice No. 14. What is the journal entry for Seahawk Fastpitch Softball to record this transaction?

Debit Accounts Payable/ Community Field $295; Credit Cash, $295 Signup and view all the answers

The Fish Friends Pet Shop purchased fish (merchandise) on account from Goldfish Supply for $152. What is the journal entry for Fish Friends Pet Shop to record this transaction?

Debit Purchases, $152; Credit Accounts Payable/Goldfish Supply, $152 Signup and view all the answers

Frazier's Car Stereo paid cash on account to Sound Wire Supply, $395, covering Purchase Invoice No. 3279. What is the journal entry for Frazier's Car Stereo to record this transaction?

Debit Accounts Payable/ Sound Wire Supply $395; credit Cash, $395 Signup and view all the answers

Loopers & Cybrand Accountants purchased office supplies on account from Quick's Supply for $50. What is the journal entry for Loopers & Cybrand Accountants to record this transaction?

Debit Office Supplies, $50; Credit Accounts Payable/Quick's Supply, $50 Signup and view all the answers

The Jungle Gym returned merchandise that was purchased on account to Footware Wholesale, $600. What is the journal entry for The Jungle Gym to record this transaction?

Debit Accounts Payable/Footware Wholesale, $600; Credit Purchases Returns and Allowances, $600 Signup and view all the answers

Belinda's Rare Books purchased merchandise for cash from Book Distributors for $900. What is the journal entry for Belinda's Rare Books to record this transaction?

Debit Purchases, $900; Credit Cash, $900 Signup and view all the answers

Michael's Hardware purchased merchandise on account from Hardware Supply for $690. What is the journal entry for Michael's Hardware to record this transaction?

Debit Purchases, $690; Credit Accounts Payable/Hardware Supply, $690 Signup and view all the answers

Fred's Furniture Store paid cash for advertising, $375. What is the journal entry to record this transaction?

Debit Advertising Expense, $375; Credit Cash, $375 Signup and view all the answers

Mike's Auto Shop purchases supplies on account from Automotive Supply for $435. What is the journal entry for Mike's Auto Shop to record this transaction?

Debit Supplies, $435; Credit Accounts Payable/Automotive Supply, $435 Signup and view all the answers

Aquisha's Bookkeeping paid cash for the telephone bill, $134. What is the journal entry to record this transaction?

Debit Telephone Expense, $134; Credit Cash, $134 Signup and view all the answers

Free Time Fishing paid $600 cash for supplies from Go Office Supply. What is the journal entry for Free Time Fishing to record this transaction?

Debit Supplies, $600; Credit Cash, $600 Signup and view all the answers

The Antique Shop purchased merchandise on account from Old Timers Supply for $128. What is the journal entry for The Antique Shop to record this transaction?

Debit Purchases, $128; Credit Accounts Payable/Old Timers Supply, $128 Signup and view all the answers

High Roads Mini Golf paid cash to Golf Equipment Distributors, $646; covering Purchase Invoice No.1746 for $680, less a 5% discount, $34.00. What is the journal entry for High Roads Mini Golf to record this transaction?

Debit Accounts Payable/ Golf Equipment Distributors, $680; Credit Purchases Discount $34 and credit Cash $646 Signup and view all the answers

Champs Country Club paid cash to Masters Jacket Supply, $931; covering Purchase Invoice No. 33 for $950, less a 2% discount, $19.00. What is the journal entry for Champs Country Club to record this transaction?

Debit Accounts Payable/ Masters Jacket Supply, $950; Credit Purchases Discount $19 and credit Cash $931 Signup and view all the answers

National Looms paid cash to Cotton Gin Warehouse, $392; covering Purchase Invoice No. 314 for $400, less a 2% discount, $8.00. What is the journal entry for National Looms to record this transaction?

Debit Accounts Payable/Cotton Gin Warehouse, $400; Credit Purchases Discount $8 and credit Cash $392 Signup and view all the answers

Impressive Signs paid cash to Peoria Paints, $513; covering Purchase Invoice No. 77 for $540, less a 5% discount, $27.00. What is the journal entry for Impressive Signs to record this transaction?

Debit Accounts Payable/ Peoria Paints, $540; Credit Purchases Discount $27 and credit Cash $513 Signup and view all the answers

Taco Home paid cash for advertising, $400. What is the journal entry to record this transaction?

Debit Advertising, $400; Credit Cash, $400 Signup and view all the answers

Christina's Curtains paid cash for the telephone bill, $110. What is the journal entry to record this transaction?

Debit Telephone Expense, $110; Credit Cash, $110 Signup and view all the answers

Bill's Grocery purchased merchandise on account from Veggie Wholesale for $249. What is the journal entry for Bill's Grocery to record this transaction?

Debit Purchases, $249; Credit Accounts Payable/Veggie Wholesale, $249 Signup and view all the answers

The Lil Kids Candy store purchased jelly beans (merchandise) on account from Jelly Belly Supply for $250. What is the journal entry for Lil Kids Candy to record this transaction?

Debit Purchases, $250; Credit Accounts Payable/Jelly Belly Supply, $250 Signup and view all the answers

Lonneisha's Quilt Shop purchased merchandise for cash from Patch Quilt Distributors for $550. What is the journal entry for Lonneisha's Quilt Shop to record this transaction?

Debit Purchases, $550; Credit Cash, $550 Signup and view all the answers

Tiny's Toys returned merchandise that was purchased on account to Jonah's Distributing, $150. What is the journal entry for Tiny's Toys to record this transaction?

Debit Accounts Payable/Jonah's Distributing, $150; Credit Purchases Returns and Allowances, $150 Signup and view all the answers

Corrugated Box Company paid cash to Paper Supply, $686; covering Purchase Invoice No. 88 for $700, less a 2% discount, $14.00. What is the journal entry for Corrugated Box Company to record this transaction?

Debit Accounts Payable/ Paper Supply, $700; Credit Purchases Discount $14 and Credit Cash $686 Signup and view all the answers

Study Notes

Journal Entries for Cash Transactions

Classic Cars, Inc. purchased supplies for $500 cash, credited Cash $500 and debited Supplies $500.
Digital Electronics paid $189 cash for supplies, debiting Supplies $189 and crediting Cash $189.
Jones' Hardware paid $750 cash for supplies, debiting Supplies $750 and crediting Cash $750.
Icy Treats purchased merchandise for cash for $100, debiting Purchases $100 and crediting Cash $100.
Sluggers Sports Shop bought merchandise for cash for $850, debiting Purchases $850 and crediting Cash $850.
Belinda's Rare Books bought merchandise for cash for $900, debiting Purchases $900 and crediting Cash $900.
Lonneisha's Quilt Shop paid cash for merchandise for $550, debiting Purchases $550 and crediting Cash $550.

Journal Entries for Purchases on Account

Carl's CDs bought store supplies on account for $425, debiting Supplies $425 and crediting Accounts Payable/Mason Supply $425.
Jacob Doe Tractor purchased on account for $942, debiting Supplies $942 and crediting Accounts Payable/Tractor Supply $942.
The Good Morning Shop purchased merchandise on account for $300, debiting Purchases $300 and crediting Accounts Payable/The Donut Plant $300.
Gill's Grills purchased store supplies on account for $829, debiting Supplies $829 and crediting Accounts Payable/Sellers Warehouse $829.
Michael's Hardware made a purchase on account for $690, debiting Purchases $690 and crediting Accounts Payable/Hardware Supply $690.
Fish Friends Pet Shop purchased on account for $152, debiting Purchases $152 and crediting Accounts Payable/Goldfish Supply $152.

Journal Entries for Discounts and Payments on Account

Mike's Music paid cash $294 after a discount, debiting Accounts Payable $300, crediting Purchases Discount $6, and crediting Cash $294.
Billy Bob's B-B-Q paid $418 cash after a discount, recording Accounts Payable $440, crediting Purchases Discount $22, and crediting Cash $418.
High Roads Mini Golf recorded payment on account as $646, with Accounts Payable $680, crediting Purchases Discount $34 and Cash $646.
National Looms paid $392 cash with a discount applied, recording Accounts Payable $400, crediting Purchases Discount $8 and Cash $392.

Journal Entries for Returns and Allowances

The Jungle Gym returned merchandise worth $600, debiting Accounts Payable/Footware Wholesale $600 and crediting Purchases Returns and Allowances $600.
Tiny's Toys returned merchandise on account for $150, debiting Accounts Payable/Jonah's Distributing $150 and crediting Purchases Returns and Allowances $150.
Dipper's Ice Cream Parlor returned merchandise worth $600, debiting Accounts Payable/The Ice Cream Company $600 and crediting Purchases Returns and Allowances $600.

Different Types of Expenses

Fred's Furniture Store paid $375 cash for advertising, debiting Advertising Expense $375 and crediting Cash $375.
Aquisha's Bookkeeping paid $134 for the telephone bill, recording as Telephone Expense $134 and crediting Cash $134.
Taco Home paid cash for advertising of $400, debiting Advertising Expense $400 and crediting Cash $400.

Key Concepts

Journal entries typically require debiting one account while crediting another to maintain balanced books.
Discounts on invoices affect the amount recorded in Cash and provide savings in purchases.
Transactions may either be paid in cash or on account, impacting cash flow and liabilities accordingly.### General Journal Entries
Debit Supplies Expense and credit Cash when purchasing supplies for $125.
Debit Supplies and credit Cash for supplies purchased at the same amount of $125.

Wally's Wallets Transaction

Paid cash of $437 to Leather Products Supply against Invoice No. 1284, originally $460 with a 5% discount of $23.
Journal entry: Debit Accounts Payable/Leather Products Supply $460, credit Purchases Discount $23, and credit Cash $437.

Wally's Watches Merchandise Return

Returned merchandise purchased on account to Timer's Distributing valued at $400.
Journal entry: Debit Accounts Payable/Timer's Distributing $400, credit Purchases Returns and Allowances $400.

Valley Products Purchase

Paid cash of $882 to Carolina Distributors against Invoice No. 1734, which was $900 with a 2% discount of $18.
Journal entry: Debit Accounts Payable/Carolina Distributors $900, credit Purchases Discount $18, and credit Cash $882.

Terry's Tree Removal Transaction

Paid cash of $735 to Sam's Sharpening Service for Invoice No. 1415, originally $750 with a 2% discount of $15.
Journal entry: Debit Accounts Payable/Sam's Sharpening Service $750, credit Purchases Discount $15, and credit Cash $735.

Betty's Boutique Purchase

Purchased merchandise for cash from Jackson Supply for $700.
Journal entry: Debit Purchases $700, credit Cash $700.

River Road Farm Supply Payment

Paid cash of $779 to C-V Chemical Distributors covering Invoice No. 623, originally $820 with a 5% discount of $41.
Journal entry: Debit Accounts Payable/C-V Chemical Distributors $820, credit Purchases Discount $41, and credit Cash $779.

Computer Phones, Inc. Payment

Paid cash of $817 to Software Supply for Invoice No. 2254, originally $860 with a 5% discount of $43.
Journal entry: Debit Accounts Payable/Software Supply $860, credit Purchases Discount $43, and credit Cash $817.

John's Appliances Purchase

Purchased merchandise on account from Electronic Supply for $990.
Journal entry: Debit Purchases $990, credit Accounts Payable/Electronic Supply $990.

Sonny's Skateboard Shop Payment

Paid cash of $795 on account to Boards Unlimited for Invoice No. 290.
Journal entry: Debit Accounts Payable/Boards Unlimited $795, credit Cash $795.

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