At the End of September 2013 and Before the Purchases

question 32

Essay

At the end of September 2013 and before the purchases journal was posted, selected general ledger account balances for Paper Products were as follows (each account had a normal balance): The purchases journal had the following totals: Purchases, $19,540; Freight In, $1,225; Accounts Payable, $20,765.
Calculate the ending balance of each of the three accounts after the posting from the purchases journal. Indicate whether each balance is a debit or credit.

---

Definitions:

Factory Insurance

An insurance policy designed to protect manufacturing facilities against losses from events like fire, theft, or natural disaster.

Depreciation

Allocating the expense of a tangible asset across its life of utility in a systematic manner.

Manufacturing Equipment

Tools, machinery, and other durable assets used in the process of producing goods in a manufacturing setting.

Cost of Goods Manufactured

The total cost incurred to manufacture products within a specific period, including materials, labor, and overhead, ready for sale.