Multi-step scenarios: journal entry worksheet
Name: Date:
Convention: United States (US textbooks)
Record each transaction as a journal entry: write each account in the Debit or the Credit column with its amount.
Buying on account, returning part, paying the rest
On May 3 a store bought merchandise on account for $6,000.00. On May 8 it returned damaged goods worth $800.00, and the supplier issued a credit memo. Both were recorded when they occurred. Today it pays the balance it owes the supplier by check. Record today’s payment only.
Assumptions: Perpetual inventory: each sale also records its cost of goods sold. No discount is granted for the payment.
Accounts to choose from: Accounts Receivable · Purchase Discounts · Inventory · Accounts Payable · Cost of Goods Sold · Cash
Account Debit Credit Credit sale, return, then payment within the discount period
On May 1 a wholesaler sold merchandise on account for $8,000.00, terms 2/10, n/30. On May 4 the customer returned merchandise with a sales price of $1,500.00, and the wholesaler issued a credit memo. On May 9 the customer pays the balance in cash and takes the discount. Record the May 9 entry.
Assumptions: The sale and the return were recorded when they happened (gross method). The discount applies to the balance after the return. No sales tax applies.
Accounts to choose from: Sales Revenue · Cash · Inventory · Interest Expense · Sales Returns and Allowances · Sales Discounts · Accounts Receivable
Account Debit Credit A machine bought, depreciated for a year, then sold
On January 1 last year a company bought a machine for $18,000.00. It depreciates it straight-line over 6 years with no salvage value, and it recorded last year's depreciation on December 31. On January 1 this year it sells the machine for $11,000.00 cash. Record the sale.
Assumptions: Depreciation is accumulated in Accumulated Depreciation. One full year of depreciation has been recorded; none is due for this year before the sale. Sales tax is ignored in this item.
Accounts to choose from: Equipment · Depreciation Expense · Accounts Receivable · Sales Revenue · Gain on Disposal of Equipment · Loss on Disposal of Equipment · Accumulated Depreciation—Equipment · Cash
Account Debit Credit Insurance renewed during the year: the year-end entry and balance
On January 1 Prepaid Insurance had a balance of $540.00: the unexpired part of last year’s policy, covering January to March. On April 1 the company renewed the policy for one year (April 1 to March 31), paid $2,640.00 and debited Prepaid Insurance. No insurance adjustments have been recorded this year. Record the adjusting entry on December 31.
Assumptions: The company adjusts its accounts only at year end.
Accounts to choose from: Unearned Revenue · Insurance Expense · Accounts Payable · Rent Expense · Cash · Prepaid Insurance
Account Debit Credit Final invoice for a service after a deposit
On March 2 a customer paid a deposit of $2,400.00 by bank transfer for a website redesign, and the company credited Unearned Revenue. Today the company completes the work, for a total price of $8,000.00, and bills the customer for the balance. Record today’s entry.
Assumptions: No sales tax applies.
Accounts to choose from: Accounts Receivable · Cash · Notes Receivable · Accounts Payable · Sales Revenue · Unearned Revenue · Service Revenue
Account Debit Credit
Practice these entries online with instant feedback: https://practibalance.com/