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Appendix
7A
Special Journals under
a Periodic System
This appendix describes special journals under a periodic inventory system. Each journal is slightly impacted. The sales journal and the cash receipts journal both require one less column (namely that of Cost
of Goods Sold Dr., Inventory Cr.). The Purchases Journal replaces the Inventory Dr. column with a Purchases Dr. column in a periodic system. The cash disbursements journal replaces the Inventory Cr. column
with a Purchases Discounts Cr. column in a periodic system. These changes are illustrated.
P3
Journalize and post
transactions using
special journals in a
periodic inventory system.
Sales Journal The sales journal using the periodic inventory system is shown in Exhibit 7A.1. The
difference in the sales journal between the perpetual and periodic system is the exclusion of the column to
record cost of goods sold and inventory amounts for each sale. The periodic system does not record the
increase in cost of goods sold and the decrease in inventory at the time of each sale.
EXHIBIT 7A.1
Page 3
Sales Journal
Date
Account
Debited
Invoice
Number
Feb. 2
7
13
15
22
25
28
28
Jason Henry
Albert Co.
Kam Moore
Paul Roth
Jason Henry
Frank Booth
Albert Co.
Total
307
308
309
310
311
312
313
Accounts Receivable Dr.
Sales Cr.
PR
✓
✓
✓
✓
✓
Sales Journal—Periodic System
450
500
350
200
225
175
250
2,150
(106/413)
✓
✓
Cash Receipts Journal The cash receipts journal using the periodic system is shown in
Exhibit 7A.2. Note the absence of the column on the far right side to record debits to Cost of Goods Sold
and credits to Inventory for the cost of merchandise sold (seen under the perpetual system). Consistent with
the cash receipts journal shown in Exhibit 7.7, we show only the weekly (summary) cash sale entries.
EXHIBIT 7A.2
Cash Receipts Journal—
Periodic System
Cash Receipts Journal
Page 2
Date
Account Credited
Explanation
PR
Cash Dr.
Feb. 7
12
14
17
20
21
22
23
25
28
28
Sales
Jason Henry
Sales
Albert Co.
Notes Payable
Sales
Interest revenue
Kam Moore
Paul Roth
Sales
Totals
Cash sales
Invoice 307, 2/2
Cash sales
Invoice 308, 2/7
Note to bank
Cash sales
Bank account
Invoice 309, 2/13
Invoice 310, 2/15
Cash sales
x
✓
x
✓
245
x
409
✓
✓
x
4,450
441
3,925
490
750
4,700
250
343
196
4,225
19,770
(101)
Sales
Discount Dr.
Accounts
Receivable Cr.
Sales Cr.
Other
Accounts Cr.
4,450
9
450
10
500
3,925
750
4,700
250
7
4
350
200
30
(415)
1,500
(106)
4,225
17,300
(413)
1,000
(x)
1
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2
Appendix 7A
EXHIBIT 7A.3
Purchases Journal The purchases journal using the periodic system is shown in Exhibit 7A.3.
This journal under a perpetual system included an Inventory column where the periodic system now has a
Purchases column.
Purchases Journal — Periodic System
Special Journals under a Periodic System
Page 1
Purchases Journal
Date
Account
Feb. 3
5
13
20
25
28
28
Horning Supply Co.
Ace Mfg. Co.
Wynet and Co.
Smite Co.
Ace Mfg. Co.
Store Supplies/ITT Co.
Totals
EXHIBIT 7A.4
Date of
Invoice
Accounts
Payable Cr.
Terms
PR
2/2
2/5
2/10
2/18
2/24
2/28
n/30
2/10, n/30
2/10, n/30
2/10, n/30
2/10, n/30
n/30
✓
✓
✓
✓
✓
125/✓
Purchases
Dr.
350
200
150
300
100
225
1,325
(201)
Office
Other
Supplies Dr. Accounts Dr.
75
275
200
150
300
100
125
1,150
(505)
25
100
(124)
75
75
(x)
Cash Disbursements Journal The cash disbursements journal using a periodic system is shown
in Exhibit 7A.4. This journal under the perpetual system included an Inventory column where the periodic
system now has the Purchases Discounts column.
Cash Disbursements
Journal — Periodic System
Cash Disbursements Journal
Page 2
Date
Ck. No.
Payee
Account Debited
PR
Cash Cr.
Feb. 3
12
15
15
20
28
28
105
106
107
108
109
110
L. and N. Railroad
East Sales Co.
Ace Mfg. Co.
Jerry Hale
Wynet and Co.
Smite Co.
Totals
Purchases
Purchases
Ace Mfg. Co.
Salaries Expense
Wynet and Co.
Smite Co.
505
505
✓
622
✓
✓
15
25
196
250
147
294
927
(101)
Purchases
Discounts Cr.
Other
Accounts Dr.
15
25
4
Accounts
Payable Dr.
200
250
3
6
13
(507)
290
150
300
650
(x)
(201)
DEMONSTRATION PROBLEM—PERIODIC SYSTEM
Pepper Company completed the following selected transactions and events during March of this year.
(Terms of all credit sales for the company are 2y10, ny30.)
Mar. 4 Sold merchandise on credit to Jennifer Nelson, Invoice No. 954, for $16,800 (cost is $12,200).
6 Purchased $1,220 of office supplies on credit from Mack Company. Invoice dated March 3,
terms ny30.
6 Sold merchandise on credit to Dennie Hoskins, Invoice No. 955, for $10,200 (cost is $8,100).
11 Purchased $52,600 of merchandise, invoice dated March 6, terms 2y10, ny30, from Defore
Industries.
12 Borrowed $26,000 cash by giving Commerce Bank a long-term promissory note payable.
14 Received cash payment from Jennifer Nelson for the March 4 sale less the discount (Invoice
No. 954).
16 Received a $200 credit memorandum from Defore Industries for unsatisfactory merchandise
Pepper purchased on March 11 and later returned.
16 Received cash payment from Dennie Hoskins for the March 6 sale less the discount (Invoice
No. 955).
18 Purchased $22,850 of store equipment on credit from Schmidt Supply, invoice dated March 15,
terms ny30.
20 Sold merchandise on credit to Marjorie Allen, Invoice No. 956, for $5,600 (cost is $3,800).
21 Sent Defore Industries Check No. 516 in payment of its March 6 dated invoice less the return
and the discount.
22 Purchased $41,625 of merchandise, invoice dated March 18, terms 2y10, ny30, from Welch
Company.
26 Issued a $600 credit memorandum to Marjorie Allen for defective merchandise Pepper sold on
March 20 and Allen later returned.
31 Issued Check No. 517, payable to Payroll, in payment of $15,900 sales salaries for the month.
Cashed the check and paid the employees.
31 Cash sales for the month are $134,680 (cost is $67,340). (Cash sales are recorded daily but are
recorded only once here to reduce repetitive entries.)
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Appendix 7A
Special Journals under a Periodic System
3
Required
1. Open the following selected general ledger accounts: Cash (101), Accounts Receivable (106), Office Sup-
plies (124), Store Equipment (165), Accounts Payable (201), Long-Term Notes Payable (251), Sales (413),
Sales Returns and Allowances (414), Sales Discounts (415), Purchases (505), Purchases Returns and Allowances (506), Purchases Discounts (507), and Sales Salaries Expense (621). Open the following accounts
receivable ledger accounts: Marjorie Allen, Dennie Hoskins, and Jennifer Nelson. Open the following accounts payable ledger accounts: Defore Industries, Mack Company, Schmidt Supply, and Welch Company.
2. Enter the transactions using a sales journal, a purchases journal, a cash receipts journal, a cash disbursements journal, and a general journal similar to the ones illustrated in Appendix 7A. Regularly
post to the individual customer and creditor accounts. Also, post any amounts that should be posted as
individual amounts to general ledger accounts. Foot and crossfoot the journals and make the monthend postings. Pepper Co. uses the periodic inventory system in this problem.
3. Prepare a trial balance for the selected general ledger accounts in part 1 and prove the accuracy of
subsidiary ledgers by preparing schedules of accounts receivable and accounts payable.
SOLUTION TO DEMONSTRATION PROBLEM—PERIODIC SYSTEM
Page 2
Sales Journal
Date
Account Debited
Invoice Number
PR
Mar. 4
6
20
31
Jennifer Nelson
Dennie Hoskins
Marjorie Allen
Totals
954
955
956
✓
✓
✓
Accounts Receivable Dr.
Sales Cr.
16,800
10,200
5,600
32,600
(106/413)
Cash Receipts Journal
Page 3
Date
Account Credited
Explanation
PR
Cash Dr.
Mar. 12
14
16
31
31
L.T. Notes Payable
Jennifer Nelson
Dennie Hoskins
Sales
Totals
Note to bank
Invoice 954, 3/4
Invoice 955, 3/6
Cash sales
251
✓
✓
x
26,000
16,464
9,996
134,680
187,140
(101)
Sales
Discount
Dr.
Accounts
Receivable
Cr.
336
204
16,800
10,200
540
27,000
134,680
134,680
26,000
(415)
(106)
(413)
(x)
Sales Cr.
26,000
Page 3
Purchases Journal
Date
Account
Mar. 6
11
18
22
31
Office Supplies/Mack Co
Defore Industries
Store Equipment/Schmidt Supp
Welch Company
Totals
Date of
Invoice
Accounts
Payable Cr.
Terms
PR
3/3
3/6
3/15
3/18
n/30
2/10, n/30
n/30
2/10, n/30
✓
✓
165/✓
✓
Purchases
Dr.
1,220
52,600
22,850
41,625
118,295
(201)
Office
Other
Supplies Dr. Accounts Dr.
1,220
52,600
22,850
41,625
94,225
(505)
1,220
(124)
Date
Ck. No.
Payee
Account Debited
PR
Cash Cr.
Mar. 21
31
31
516
517
Defore Industries
Payroll
Totals
Defore Industries
Sales Salaries Expense
✓
621
51,352
15,900
67,252
(101)
General Journal
26
22,850
(x)
Page 3
Cash Disbursements Journal
Mar. 16
Other
Accounts
Cr.
Accounts Payable — Defore Industries . . . . . . . . . . . . .
Purchases Returns and Allowances . . . . . . . . . . . .
To record credit memorandum received.
Sales Returns and Allowances . . . . . . . . . . . . . . . . . . . .
Accounts Receivable — Marjorie Allen . . . . . . . . . .
To record credit memorandum issued.
Purchases
Discount Cr.
1,048
1,048
(507)
Page 2
201/✓
506
200
414
106/✓
600
200
600
Other
Accounts Dr.
15,900
15,900
(x)
Accounts
Payable Dr.
52,400
52,400
(201)
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Appendix 7A
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Special Journals under a Periodic System
Accounts Payable Ledger
Accounts Receivable Ledger
Defore Industries
Marjorie Allen
Date
PR
Debit
Mar. 20
26
S2
G2
5,600
Credit
600
Balance
Date
PR
Debit
5,600
5,000
Mar. 11
16
21
P3
G2
D3
200
52,400
Dennie Hoskins
Date
PR
Debit
Mar. 6
16
S2
R3
10,200
Credit
Balance
10,200
10,200
0
Credit
Balance
52,600
52,600
52,400
0
Credit
Balance
1,220
1,220
Credit
Balance
22,850
22,850
Credit
Balance
41,625
41,625
Mack Company
Date
PR
Mar. 6
P3
Debit
Schmidt Supply
Jennifer Nelson
Date
PR
Debit
Mar. 4
14
S2
R3
16,800
Credit
Balance
Date
PR
16,800
0
Mar. 18
P3
16,800
Debit
Welch Company
Date
PR
Mar. 22
P3
Debit
General Ledger (Partial Listing)
Cash
Acct. No. 101
Date
PR
Debit
Mar. 31
31
R3
D3
187,140
Accounts Receivable
Date
PR
Debit
Mar. 26
31
31
G2
S2
R3
32,600
PR
Debit
Mar. 31
P3
1,220
Store Equipment
PR
Debit
Mar. 18
P3
22,850
Accounts Payable
PR
Debit
Mar. 16
31
31
G2
P3
D3
200
67,252
187,140
119,888
Mar. 31
31
S2
R3
Acct. No. 106
Debit
Credit
Balance
32,600
134,680
32,600
167,280
Sales Returns and Allowances
Credit
Balance
Date
PR
Debit
600
(600)
32,000
5,000
Mar. 26
G2
600
Credit
Balance
1,220
Credit
Balance
22,850
Credit
Balance
118,295
(200)
118,095
65,695
52,400
Long-Term Notes Payable
R3
PR
Acct. No. 201
Date
Mar. 12
Date
Sales Discounts
Acct. No. 414
Credit
Balance
600
Acct. No. 415
Date
PR
Debit
Mar. 31
R3
540
Credit
Balance
Purchases
540
Acct. No. 505
Date
PR
Debit
Mar. 31
P3
94,225
Credit
Balance
Acct. No. 165
Date
PR
Balance
Acct. No. 124
Date
Date
Acct. No. 413
Credit
27,000
Office Supplies
Sales
Debit
Acct. No. 251
Credit
Balance
26,000
26,000
Purchases Returns
and Allowances
Date
PR
Mar. 16
G2
Debit
Purchases Discounts
Date
PR
Mar. 31
D3
Debit
Sales Salaries Expense
Date
PR
Debit
Mar. 31
D3
15,900
94,225
Acct. No. 506
Credit
Balance
200
200
Acct. No. 507
Credit
Balance
1,048
1,048
Acct. No. 621
Credit
Balance
15,900
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Appendix 7A
Special Journals under a Periodic System
5
PEPPER COMPANY
Trial Balance (partial)
March 31
Debit
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts receivable . . . . . . . . . . . . . . . . . . .
Office supplies . . . . . . . . . . . . . . . . . . . . . . . .
Store equipment . . . . . . . . . . . . . . . . . . . . . .
Accounts payable . . . . . . . . . . . . . . . . . . . . .
Long-term notes payable . . . . . . . . . . . . . . .
Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Sales returns and allowances . . . . . . . . . . . .
Sales discounts . . . . . . . . . . . . . . . . . . . . . . .
Purchases . . . . . . . . . . . . . . . . . . . . . . . . . . .
Purchases returns and allowances . . . . . . . .
Purchases discounts . . . . . . . . . . . . . . . . . . .
Sales salaries expense . . . . . . . . . . . . . . . . . .
Totals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Credit
PEPPER COMPANY
Schedule of Accounts Receivable
March 31
$119,888
5,000
1,220
22,850
$ 65,695
26,000
167,280
$5,000
$5,000
PEPPER COMPANY
Schedule of Accounts Payable
March 31
600
540
94,225
200
1,048
15,900
$260,223
Marjorie Allen . . . . . . . . . . . . . . . .
Total accounts receivable . . . . . . .
$260,223
Mack Company . . . . . . . . . . . . . .
Schmidt Supply . . . . . . . . . . . . . .
Welch Company . . . . . . . . . . . . .
Total accounts payable . . . . . . . .
$ 1,220
22,850
41,625
$65,695
Summary
and post transactions using special journals in
P3A Journalize
a periodic inventory system. Transactions are journalized
and posted using special journals in a periodic system. The methods
are similar to those in a perpetual system; the primary difference is
that both cost of goods sold and inventory are not adjusted at the
time of each sale. This usually results in the deletion (or renaming)
of one or more columns devoted to these accounts in each special
journal.
For account titles and numbers, use the Chart of Accounts at the end of the book.
Prepare headings for a purchases journal like the one in Exhibit 7A.3. Journalize the May transactions from
QS 7-7 that should be recorded in the purchases journal assuming the periodic inventory system is used.
QUICK STUDY
QS 7-12A
Purchases journal—periodic
For account titles and numbers, use the Chart of Accounts at the end of the book.
EXERCISES
Prepare headings for a sales journal like the one in Exhibit 7A.1. Journalize the May transactions shown
in Exercise 7-1 that should be recorded in the sales journal assuming that the periodic inventory system
is used.
Exercise 7-12A
Sales journal—periodic
Prepare headings for a cash receipts journal like the one in Exhibit 7A.2. Journalize the November
transactions shown in Exercise 7-3 that should be recorded in the cash receipts journal assuming that the
periodic inventory system is used.
Exercise 7-13A
Prepare headings for a cash disbursements journal like the one in Exhibit 7A.4. Journalize the April transactions from Exercise 7-6 that should be recorded in the cash disbursements journal assuming that the
periodic inventory system is used.
Exercise 7-14A
P3
P3
Cash receipts journal—periodic
P3
Cash disbursements
journal—periodic P3
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6
Appendix 7A
PROBLEM SET A
Problem 7-4AA
Special journals, subsidiary
ledgers, and schedule of
accounts receivable—periodic
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Special Journals under a Periodic System
For account titles and numbers, use the Chart of Accounts at the end of the book.
Assume that Wiset Co. in Problem 7-1A uses the periodic inventory system.
Required
1. Prepare headings for a sales journal like the one in Exhibit 7A.1. Prepare headings for a cash receipts
Check Trial balance totals, $434,285
journal like the one in Exhibit 7A.2. Journalize the April transactions shown in Problem 7-1A that
should be recorded in the sales journal and the cash receipts journal assuming the periodic inventory
system is used.
2. Open the general ledger accounts with balances as shown in Problem 7-1A (do not open a Cost
of Goods Sold ledger account). Also open accounts receivable subsidiary ledger accounts for
Page Alistair, Paula Kohr, and Nic Nelson. Under the periodic system, an Inventory account exists but
is inactive until its balance is updated to the correct inventory balance at year-end. In this problem, the
Inventory account remains inactive but must be included to correctly complete the trial balance.
3. Complete parts 3, 4, and 5 of Problem 7-1A using the results of parts 1 and 2 of this problem.
Problem 7-5AA
Refer to Problem 7-1A and assume that Wiset Co. uses the periodic inventory system.
Special journals, subsidiary
ledgers, and schedule of
accounts payable—periodic
Required
C3 P2 P3
C3 P2 P3
1. Prepare a general journal, a purchases journal like that in Exhibit 7A.3, and a cash disbursements
Check Trial balance totals, $237,026
journal like that in Exhibit 7A.4. Number all journal pages as page 3. Review the April transactions
of Wiset Company (Problem 7-1A) and enter those transactions that should be journalized in the
general journal, the purchases journal, or the cash disbursements journal. Ignore any transaction
that should be journalized in a sales journal or cash receipts journal.
2. Open the following general ledger accounts: Cash, Inventory, Office Supplies, Store Supplies, Store
Equipment, Accounts Payable, Long-Term Notes Payable, B. Wiset, Capital, Purchases, Purchases
Returns and Allowances, Purchases Discounts, Sales Salaries Expense, and Advertising Expense. Enter the March 31 balances of Cash ($85,000), Inventory ($125,000), Long-Term Notes Payable
($110,000), and B. Wiset, Capital ($100,000). Also open accounts payable subsidiary ledger accounts
for Hal’s Supply, Noth Company, Grant Company, and Custer, Inc.
3. Complete parts 3 and 4 of Problem 7-2A using the results of parts 1 and 2 of this problem.
Problem 7-6AA
Assume that Church Company in Problem 7-3A uses the periodic inventory system.
Special journals, subsidiary
ledgers, trial balance—periodic
Required
C3 P2 P3
1. Open the following general ledger accounts: Cash; Accounts Receivable; Inventory (March 1 beg. bal.
mhhe.com/wildFAP21e
Check Trial balance totals, $236,806
is $10,000); Office Supplies; Store Supplies; Office Equipment; Accounts Payable; Long-Term Notes
Payable; Z. Church, Capital (March 1 beg. bal. is $10,000); Sales; Sales Discounts; Purchases; Purchases Returns and Allowances; Purchases Discounts; and Sales Salaries Expense. Open the following
accounts receivable subsidiary ledger accounts: Jovita Albany, Min Cho, and Linda Witt. Open the
following accounts payable subsidiary ledger accounts: Gabel Company, Van Industries, Spell Supply,
and CD Company.
2. Enter the transactions from Problem 7-3A in a sales journal like that in Exhibit 7A.1, a purchases journal like that in Exhibit 7A.3, a cash receipts journal like that in Exhibit 7A.2, a cash disbursements
journal like that in Exhibit 7A.4, or a general journal. Number journal pages as page 2.
3. Prepare a trial balance of the general ledger and prove the accuracy of the subsidiary ledgers by preparing schedules of both accounts receivable and accounts payable.
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Appendix 7A
Special Journals under a Periodic System
For account titles and numbers, use the Chart of Accounts at the end of the book.
Assume that Acorn Industries in Problem 7-1B uses the periodic inventory system.
Required
1. Prepare headings for a sales journal like the one in Exhibit 7A.1. Prepare headings for a cash receipts jour-
nal like the one in Exhibit 7A.2. Journalize the July transactions shown in Problem 7-1B that should be
recorded in the sales journal and the cash receipts journal assuming the periodic inventory system is used.
2. Open the general ledger accounts with balances as shown in Problem 7-1B (do not open a Cost of
Goods Sold ledger account). Also open accounts receivable subsidiary ledger accounts for Ruth Blake,
Ashton Moore, and Kim Nettle. Under the periodic system, an Inventory account exists but is inactive
until its balance is updated to the correct inventory balance at year-end. In this problem, the Inventory
account remains inactive but must be included to correctly complete the trial balance.
3. Complete parts 3, 4, and 5 of Problem 7-1B using the results of parts 1 and 2 of this problem.
7
PROBLEM SET B
Problem 7-4BA
Special journals, subsidiary
ledgers, and schedule of
accounts receivable—periodic
C3 P2 P3
Check Trial balance totals, $588,264
Refer to Problem 7-1B and assume that Acorn uses the periodic inventory system.
Problem 7-5BA
Required
Special journals, subsidiary
ledgers, and schedule of
accounts payable—periodic
1. Prepare a general journal, a purchases journal like that in Exhibit 7A.3, and a cash disbursements jour-
C3 P2 P3
nal like that in Exhibit 7A.4. Number all journal pages as page 3. Review the July transactions of
Acorn Company (Problem 7-1B) and enter those transactions that should be journalized in the general
journal, the purchases journal, or the cash disbursements journal. Ignore any transaction that should be
journalized in a sales journal or cash receipts journal.
2. Open the following general ledger accounts: Cash, Inventory, Office Supplies, Store Supplies, Store
Equipment, Accounts Payable, Long-Term Notes Payable, R. Acorn, Capital, Purchases, Purchases
Returns and Allowances, Purchases Discounts, Sales Salaries Expense, and Advertising Expense.
Enter the June 30 balances of Cash ($100,000), Inventory ($200,000), Long-Term Notes Payable
($200,000), and R. Acorn, Capital ($100,000). Also open accounts payable subsidiary ledger accounts for Teton Company, Plaine, Inc., Charm’s Supply, and Drake Company.
3. Complete parts 3 and 4 of Problem 7-2B using the results of parts 1 and 2 of this problem.
Check Trial balance totals, $352,266
Assume that Grassley Company in Problem 7-3B uses the periodic inventory system.
Problem 7-6BA
Required
Special journals, subsidiary
ledgers, trial balance—periodic
1. Open the following general ledger accounts: Cash; Accounts Receivable; Inventory (November 1 beg.
C3 P2 P3
bal. is $40,000); Office Supplies; Store Supplies; Office Equipment; Accounts Payable; Long-Term
Notes Payable; C. Grassley, Capital (Nov. 1 beg. bal. is $40,000); Sales; Sales Discounts; Purchases;
Purchases Returns and Allowances; Purchases Discounts; and Sales Salaries Expense. Open the following accounts receivable subsidiary ledger accounts: Carlos Mantel, Tori Tripp, and Cyd Rounder.
Open the following accounts payable subsidiary ledger accounts: Grebe Company, BLR Industries,
Brun Supply, and Lo Company.
2. Enter the transactions from Problem 7-3B in a sales journal like that in Exhibit 7A.1, a purchases journal like that in Exhibit 7A.3, a cash receipts journal like that in Exhibit 7A.2, a cash disbursements
journal like that in Exhibit 7A.4, or a general journal. Number journal pages as page 2.
3. Prepare a trial balance of the general ledger and prove the accuracy of the subsidiary ledgers by preparing schedules of both accounts receivable and accounts payable.
Check Trial balance totals, $203,550