Lasting Summer Inc has 2 510 in the October 1 balance

#6894
Lasting Summer Inc has 2 510 in the October 1 balance

Lasting Summer Inc. has $2,510 in the October 1 balance of the accounts receivable account
consisting of $1,060 from Champion Co. and $1,450 from Wayfarer Co. Transactions related to
revenue and cash receipts completed by Lasting Summer Inc. during the month of October
20Y5 are as follows:

Oct. 3. Issued Invoice No. 622 for services provided to Palace Corp., $2,890.

5. Received cash from Champion Co., on account, for $1,060.

8. Issued Invoice No. 623 for services provided to Sunny Style Inc., $1,940.

12. Received cash from Wayfarer Co., on account, for $1,450.

18. Issued Invoice No. 624 for services provided to Amex Services Inc., $2,970.

23. Received cash from Palace Corp. for Invoice No. 622 of October 3.

28. Issued Invoice No. 625 to Wayfarer Co., on account, for $900.

30. Received cash from Rogers Co. for services provided, $120.

a. Prepare a single-column revenue journal and a cash receipts journal to record these
transactions. Use the following column headings for the cash receipts journal: Fees Earned Cr.,
Accounts Receivable Cr., and Cash Dr. Place a check mark (?) in the Post. Ref. column to
indicate when the accounts receivable subsidiary ledger should be posted.

b. Prepare a listing of the accounts receivable customer balances and verify that the total of the
accounts receivable customer balances equals the balance of the accounts receivable
controlling account on October 31, 20Y5.

c. Why does Lasting Summer Inc. use a subsidiary ledger for accounts receivable?

Lasting Summer Inc has 2 510 in the October 1 balance

ANSWER
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