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Accounting for Purchases and Accounts Payable. Section 2: Accounts Payable. . Chapter. 8. Section Objectives. Post credit purchases from the purchases journal to the accounts payable subsidiary ledger.Record purchases returns and allowances in the general journal and post them to the accounts payable subsidiary ledger.Prepare a schedule of accounts payable.Compute the net delivered cost of purchases.Demonstrate a knowledge of the procedures for effective internal control of purchases..
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2. Section 2 of the chapter continues the purchasing process and introduces the accounts payable subsidiary ledger. In objective 3 we will learn how to post credit purchases from the purchases journal to the accounts payable subsidiary ledger.
Section 2 of the chapter continues the purchasing process and introduces the accounts payable subsidiary ledger. In objective 3 we will learn how to post credit purchases from the purchases journal to the accounts payable subsidiary ledger.
4. Many businesses use an accounts payable subsidiary ledger to track amounts owed, to whom they are owed, when they are due, and discount terms. This ensures that the firms will have enough cash to pay for obligations.Many businesses use an accounts payable subsidiary ledger to track amounts owed, to whom they are owed, when they are due, and discount terms. This ensures that the firms will have enough cash to pay for obligations.
5. Let’s review what an accounts payable subsidiary ledger looks like. It is similar to the accounts receivable subsidiary ledger discussed in the previous chapter.Let’s review what an accounts payable subsidiary ledger looks like. It is similar to the accounts receivable subsidiary ledger discussed in the previous chapter.
7. Posting to the subsidiary ledger from the purchases journal is done on a daily basis.Posting to the subsidiary ledger from the purchases journal is done on a daily basis.
8. To keep the accounting records up to date, invoices are posted to the Accounts Payable Subsidiary Ledger every day.
To keep the accounting records up to date, invoices are posted to the Accounts Payable Subsidiary Ledger every day.
9. Let’s review the posting process.Let’s review the posting process.
10. Transfer the date.
Transfer the invoice number, credit terms, etc.
Place P1 in the posting reference column indicating that the journal entry is in the Purchases journal on page 1.Transfer the date.
Transfer the invoice number, credit terms, etc.
Place P1 in the posting reference column indicating that the journal entry is in the Purchases journal on page 1.
11. 4. Write the dollar amount of the purchase in the credit column.4. Write the dollar amount of the purchase in the credit column.
12. Step 5. Recalculate the balance in the subsidiary ledger.Step 5. Recalculate the balance in the subsidiary ledger.
13. Step 6. Place a check mark in the posting reference column indicating that a subsidiary ledger account was updated.Step 6. Place a check mark in the posting reference column indicating that a subsidiary ledger account was updated.
14. When we pay an invoice… When we pay an invoice…
15. We will use another special journal called the Cash Payments Journal.We will use another special journal called the Cash Payments Journal.
16. The cash payment is then posted to the individual creditor’s account in the accounts payable ledger.The cash payment is then posted to the individual creditor’s account in the accounts payable ledger.
17. Accounts Payable will be debited for $476 and Purchase Returns and Allowances will be credited for $476.Accounts Payable will be debited for $476 and Purchase Returns and Allowances will be credited for $476.
