Question

Purchases and Cash Payments Journals; Accounts Payable subsidiary and General Ledgers

West Texas Exploration Co. was established on October 15 to provide oil-drilling services. West Texas uses field equipment (rigs and pipe) and field supplies (drill bits and lubricants) in its operations. Transactions related to purchases and cash payments during the remainder of October are as follows:

Oct. 16.		Issued Check No. 1 in payment of rent for the remainder of October, $7,000.
16.		Purchased field equipment on account from Petro Services Inc., $32,600.
17.		Purchased field supplies on account from Midland Supply Co., $9,780.
18.		Issued Check No. 2 in payment of field supplies, $4,570, and office supplies, $650.
20.		Purchased office supplies on account from A-One Office Supply Co., $1,320.
		Post the journals to the accounts payable subsidiary ledger.
24.		Issued Check No. 3 to Petro Services Inc., in payment of October 16 invoice.
26.		Issued Check No. 4 to Midland Supply Co. in payment of October 17 invoice.
28.		Issued Check No. 5 to purchase land, $240,000.
28.		Purchased office supplies on account from A-One Office Supply Co., $3,670.
		Post the journals to the accounts payable subsidiary ledger.
30.		Purchased the following from Petro Services Inc. on account: field supplies, $25,300 and office equipment, $5,500.
30.		Issued Check No. 6 to A-One Office Supply Co. in payment of October 20 invoice.
30.		Purchased field supplies on account from Midland Supply Co., $12,450.
31.		Issued Check No. 7 in payment of salaries, $32,000.
31.		Rented building for one year in exchange for field equipment having a cost of $15,000.
		Post the journals to the accounts payable subsidiary ledger.

Required:

1. Journalize the transactions (in chronological order as presented in the data) for October. Use a purchases journal and a cash payments journal, and a two-column general journal. Use debit columns for Field Supplies, Office Supplies, and Other Accounts in the purchases journal. Refer to the following partial chart of accounts:

11	Cash	18	Office Equipment
14	Field Supplies	19	Land
15	Office Supplies	21	Accounts Payable
16	Prepaid Rent	61	Salary Expense
17	Field Equipment	71	Rent Expense

At the points indicated in the narrative of transactions, post to the following subsidiary accounts in the accounts payable ledger:

A-One Office Supply Co.

Midland Supply Co.

Petro Services Inc.

2. Post the individual entries in chronological order (Other Accounts columns of the purchases journal and the cash payments journal; both columns of the general journal) to the appropriate general ledger accounts.

3. Total each of the columns of the purchases journal and the cash payments journal, and post the appropriate totals to the general ledge in chronological order. However, if there is more than one entry on the same date, post from the purchases journal before posting from the cash payments journal.r.

If no other account is needed in the "Other Accounts Dr." column select "No Entry Required". For those boxes in which no entry is required, leave the box blank.

PURCHASES JOURNAL								PAGE 1
Date	Account Credited	Post. Ref.	Accounts Payable Cr.	Field Supplies Dr.	Office Supplies Dr.	Other Accounts Dr.	Post. Ref.	Amount
Oct. 16		?
		?				No Entry Required
		?				No Entry Required
	A-One Office Supply Co.	?
		?
		?				No Entry Required

CASH PAYMENTS JOURNAL						PAGE 1
Date	Ck No.	Account Debited	Post Ref.	Other Accounts Dr.	Accounts Payable Dr.	Cash Cr.
			?
			?
			?
		Total

JOURNAL				PAGE 1
Date	Description	Post. Ref.	Debit	Credit

Answer 1

Date	Account	Debit	Credit
Oct 16	Rent Expense	7000
	Cash		7000
Oct 16	Field Equipment	32600
	Accounts Payable		32600
Oct 17	Field Supplies	9780
	Accounts Payable		9780
Oct 18	Accounts Payable	4570
	Office Supplies	650
	Cash		5220
Oct 20	Office Supplies	1320
	Accounts Payable		1320
Oct 24	Accounts Payable	32600
	Cash		32600
Oct 26	Accounts Payable	9780
	Cash		9780
Oct 28	Land	240000
	Cash		240000
Oct 28	Office Supplies	3670
	Accounts Payable		3670
Oct 30	Field Supplies	25300
	Office Equipment	5500
	Accounts Payable		30800
Oct 30	Accounts Payable	1320
	Bank		1320
Oct 30	Field Supplies	12450
	Accounts Payable		12450
Oct 31	Salaries	32000
	Cash		32000