Question

The Chewbacca Starship Company had the following transactions during the month of December:

a. purchased inventory on account for $230,000 (assume Chewbacca uses a perpetual inventory system)
b. paid $57,000 in salaries to employees for work performed during the month
c. sold merchandise that cost $154,000 to credit customers for $285,000
d. collected $265,000 in cash from credit customers
e. paid suppliers of inventory $210,000.

Required:
Post the above transactions to the T-accounts. Assume that the opening balances in each of the accounts is zero except for cash, accounts receivable, and accounts payable that had opening balances of $73,500, $60,000, and $39,000, respectively.

Answer 1

The Chewbacca Starship Company

T-accounts:

Cash

Date Account Titles Debit Credit

Dec. 1 Beginning balance $73,500

Dec. 31 Salaries expense $57,000

Dec. 31 Accounts receivable 265,000

Dec. 31 Accounts payable 210,000

Accounts receivable

Date Account Titles Debit Credit

Dec. 1 Beginning balance $60,000

Dec. 31 Sales revenue 154,000

Dec. 31 Cash $265,000

Accounts payable

Date Account Titles Debit Credit

Dec. 1 Beginning balance $39,000

Dec. 31 Inventory 230,000

Dec. 31 Cash $210,000

Inventory

Date Account Titles Debit Credit

Dec. 31 Accounts payable $230,000

Sales revenue

Date Account Titles Debit Credit

Dec. 31 Accounts receivable $154,000

Salaries Expense

Date Account Titles Debit Credit

Dec. 31 Cash $57,000

Step-by-step explanation:

a) Data and Analysis:

a. Inventory $230,000 Accounts payable $230,000

b. Salaries expense $57,000 Cash $57,000

c. Accounts receivable $154,000 Sales revenue $154,000

d. Cash $365,000 Accounts receivable $265,000

e. Accounts payable $210,000 Cash $210,000

Opening balances:

Cash $73,500

Accounts receivable $60,000

Accounts payable $39,000