Homework SourseJOURNAL ENTRIES OF 7 January 11 The office manager in San Di
JOURNAL ENTRIES OF:
7
January 11
The office manager in San Diego ordered $380 of office (operating) supplies from Staples. While on the way back from a delivery, one of the warehouse staff picked up the Staples order and brought it to GBI’s office. GBI has an account with Staples and payment terms are net 10. Operating supplies expense is figured at the end of the month determined by the amount of supplies used during the month.
8
GBI ordered $75000 in raw materials from Space Bike Composites in Houston, TX. Terms of payment to Space Bikes are net 30.
9
GBI received payment from Windy City Bikes for their order from January 3. Windy City paid the invoice amount less the discount for paying within 10 days.
10
January 12
GBI paid for the inventory order (via bank transfer) that they received from Dallas Bike Basics back on January 3.
11
January 13
In order to better track inventory, GBI ordered a bar-coding and tracking system which will be installed and tested by Computer Specialists, Inc. (CSI). The system will allow employees to track inventory using mobile devices and special software which will link into their new computerized accounting system. The barcode system costs $6,000 (including sales tax) and CSI will charge GBI $1,300 for the installation and tests. GBI paid a deposit of $2,500 on the system and the remainder is due and payable when the system is installed. GBI will classify the bar-coding system as “Production Machinery, Equipment and Fixtures”.
12
January 17
GBI paid an invoice from Lightbulb Accessory Kits for ordered goods that were received on December 20. The amount of the invoice from Lightbulb is $15,890 due net 30.
13
The city of Denver will be hosting a decathlon at the end of February. The event is expected to create demand for high quality bikes. Rocky Mountain Bikes in Denver, CO placed an order with GBI for $128,000 worth of bicycles to be delivered immediately. Rocky Mountain will pay the shipping. The bikes cost GBI $78,000. GBI shipped the order immediately so that Rocky Mountain can start promoting the bikes. Because Rocky Mountain is a good customer, GBI is giving them special terms of net 45 days on this order.
14
GBI received raw materials inventory ordered from Space Bike Composites January 11. Shipping charges of $600 were included in the invoice from Space Bike.
15
GBI received notice that Bunky’s Bicycle Emporium had declared section 13 bankruptcy which meant GBI would not be able to collect the $4,200 that Bunky’s owed them.
| 7 | January 11 | The office manager in San Diego ordered $380 of office (operating) supplies from Staples. While on the way back from a delivery, one of the warehouse staff picked up the Staples order and brought it to GBI’s office. GBI has an account with Staples and payment terms are net 10. Operating supplies expense is figured at the end of the month determined by the amount of supplies used during the month. |
| 8 | GBI ordered $75000 in raw materials from Space Bike Composites in Houston, TX. Terms of payment to Space Bikes are net 30. | |
| 9 | GBI received payment from Windy City Bikes for their order from January 3. Windy City paid the invoice amount less the discount for paying within 10 days. | |
| 10 | January 12 | GBI paid for the inventory order (via bank transfer) that they received from Dallas Bike Basics back on January 3. |
| 11 | January 13 | In order to better track inventory, GBI ordered a bar-coding and tracking system which will be installed and tested by Computer Specialists, Inc. (CSI). The system will allow employees to track inventory using mobile devices and special software which will link into their new computerized accounting system. The barcode system costs $6,000 (including sales tax) and CSI will charge GBI $1,300 for the installation and tests. GBI paid a deposit of $2,500 on the system and the remainder is due and payable when the system is installed. GBI will classify the bar-coding system as “Production Machinery, Equipment and Fixtures”. |
| 12 | January 17 | GBI paid an invoice from Lightbulb Accessory Kits for ordered goods that were received on December 20. The amount of the invoice from Lightbulb is $15,890 due net 30. |
| 13 | The city of Denver will be hosting a decathlon at the end of February. The event is expected to create demand for high quality bikes. Rocky Mountain Bikes in Denver, CO placed an order with GBI for $128,000 worth of bicycles to be delivered immediately. Rocky Mountain will pay the shipping. The bikes cost GBI $78,000. GBI shipped the order immediately so that Rocky Mountain can start promoting the bikes. Because Rocky Mountain is a good customer, GBI is giving them special terms of net 45 days on this order. | |
| 14 | GBI received raw materials inventory ordered from Space Bike Composites January 11. Shipping charges of $600 were included in the invoice from Space Bike. | |
| 15 | GBI received notice that Bunky’s Bicycle Emporium had declared section 13 bankruptcy which meant GBI would not be able to collect the $4,200 that Bunky’s owed them. |
Solution
Journal Entries in the books of GBI Date Particulars Dr. $ Cr. $ 7 11-Jan Office Supplies Purchase 380 To, Staples 380 (Being Operating supplies purchased from staples) 8 11-Jan NO ENTRY ( As only order is placed) 9 11-Jan Bank A/C Xx To, Windy City Xx (Being payment received from Winda city for 3rd January Order net of Cash discount) {Amount not mentioned as it is mentioned in the above part of the question which is not given} 10 12-Jan Dallas Bike Basics Xx To, Bank Xx (Being payment done to Dellas Bike for 3rd January Order) {Amount not mentioned as it is mentioned in the above part of the question which is not given} 11 13-Jan Advance for bar-coding and tracking system 2500 To, Bank 2500 (Being advance given for the new bar-coding and tracking system) 12 17-Jan Lightbulb Accessory Kits 17890 To, Bank 17890 (Being payment done to Lightbulb for 20th December Order) 13 17-Jan Rocky Mountain Bikes 128000 To, Sales 128000 (Being high quality bikes supplied to Rocky Mountain bikes) 14 17-Jan Raw Material Purchase 75600 To, Space Bike Composites 75600 (Being Raw material received from Space Bike Composites ordered as on 11th January along with shipping charges of 600$) 15 17-Jan Bad Debt 4200 To, Bunky’s Bicycle Emporium 4200 (Being amount irrecovarable on account of bankruptcy filed by debtor)
