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Section 1 The Sales Journal

Chapter 16. Section 1 The Sales Journal. $. What You’ll Learn To identify the special journals and how they are used. How to record sales of merchandise on account in a sales journal. How to post from the sales journal to the accounts receivable subsidiary ledger accounts.

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Section 1 The Sales Journal

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  1. Chapter 16 Section 1 The Sales Journal $ • What You’ll Learn • To identify the special journals and how they are used. • How to record sales of merchandise on account in a sales journal. • How to post from the sales journal to the accounts receivable subsidiary ledger accounts. • How to foot, prove, total, and rule the sales journal. • How to post column totals from the sales journal to the general ledger. $ $ $

  2. Section 1 The Sales Journal (cont'd.) Chapter 16 $ Why It’s Important The use of the sales journal provides a systematic method of keeping track of sales on account. $ $ • Key Terms • special journals • sales journal • footing $

  3. Section 1 The Sales Journal (cont'd.) Chapter 16 $ Special Journals Special journals have amount columns used to record debits and credits to specific general ledger accounts. $ Journal Transaction $ Sales Journal sales of merchandise on account Cash Receipts Journal receipt of cash $ Purchases Journal purchase of any asset on account Cash Payments Journal payment of cash, including payments by check

  4. Section 1 The Sales Journal (cont'd.) Chapter 16 $ The Sales Journal The sales journal is a special journal used to record sales of merchandise on account. $ $ • Record the amount of the merchandise sold on account $ • Record the amount of sales tax on the sale • Record the total amount to be received from the customer on account

  5. Section 1 The Sales Journal (cont'd.) Chapter 16 $ Recording Sales of Merchandise on Account Business Transaction $ On December 1, On Your Mark sold merchandise on account to Casey Klein for $200 plus $12 sales tax, Sales Slip 50. $ JOURNAL ENTRY $

  6. Section 1 The Sales Journal (cont'd.) Chapter 16 $ Posting a Sales Journal Entry to the Accounts Receivable Subsidiary Ledger To keep the balances of the customer accounts current, sales journal transactions are posted daily to the accounts receivable subsidiary ledger. $ $ $

  7. Section 1 The Sales Journal (cont'd.) Chapter 16 $ Footing, Totaling, Proving, and Ruling the Sales Journal $ $ $

  8. Section 1 The Sales Journal (cont'd.) Chapter 16 $ Posting the Total of the Sales Credit Column Next, transfer the amount in the Sales column to the general ledger. $ $ $

  9. Section 1 The Sales Journal (cont'd.) Chapter 16 $ Posting the Total of the Sales Tax Payable Credit Column Next, transfer the amount in the Sales Tax Payable column to the general ledger. $ $ $

  10. Section 1 The Sales Journal (cont'd.) Chapter 16 $ Posting the Total of the Accounts Receivable Debit Column The last amount to be transferred to the general ledger is the Accounts Receivable Debit column. $ $ $

  11. Section 1 The Sales Journal (cont'd.) Chapter 16 $ Proving the Sales Journal at the End of a Page If a business has many transactions in one month, and it is impossible to fit them onto one journal page, the journal page must be totaled and ruled before a new page is started. $ $ $

  12. Chapter 16 Section 2 The Cash Receipts Journal $ • What You’ll Learn • How to record transactions in the cash receipts journal. • How to post from the cash receipts journal to accounts receivable subsidiary ledger accounts. • How to post amounts in the General Credit column of the cash receipts journal to general ledger accounts. • How to post column totals from the cash receipts journal to the general ledger. • How to prepare a schedule of accounts receivable. $ $ $

  13. Section 2 The Cash Receipts Journal (cont'd.) Chapter 16 $ Why It’s Important Use of the cash receipts journal will save time and reduce errors. $ $ • Key Terms • cash receipts journal • schedule of accounts receivable $

  14. Section 2 The Cash Receipts Journal (cont'd.) Chapter 16 $ The Cash Receipts Journal A special journal used to record all cash receipt transactions. $ $ $

  15. Section 2 The Cash Receipts Journal (cont'd.) Chapter 16 $ Recording Cash from Charge Customers Business Transaction $ On December 5, On Your Mark received $212 from Casey Klein to apply on account, Receipt 301. $ JOURNAL ENTRY $

  16. Section 2 The Cash Receipts Journal (cont'd.) Chapter 16 $ Recording Cash Received on Account, Less a Cash Discount Business Transaction $ On December 12, On Your Mark received $1,470 from South Branch High School Athletics in pay- ment of Sales Slip 51 for $1,500 less the discount of $30, Receipt 302. $ JOURNAL ENTRY $

  17. Section 2 The Cash Receipts Journal (cont'd.) Chapter 16 $ Recording Cash Sales Business Transaction $ On December 15, On Your Mark records the cash sales for the first two weeks of December, $3,000, and $180 in related sales taxes, Tape 55. $ JOURNAL ENTRY $

  18. Section 2 The Cash Receipts Journal (cont'd.) Chapter 16 $ Posting to the Accounts Receivable Subsidiary Ledger Daily postings are made from the Accounts Receivable Credit column to the accounts receivable subsidiary ledger. $ $ $

  19. Section 2 The Cash Receipts Journal (cont'd.) Chapter 16 $ Posting the General Credit Column Daily postings are made from the General Credit column of the cash receipts journal to the appropriate accounts in the general ledger. $ $ $

  20. Section 2 The Cash Receipts Journal (cont'd.) Chapter 16 $ Footing, Totaling, Proving, and Ruling the Cash Receipts Journal To complete the cash receipts journal, follow these steps: $ $ 1.Draw a single rule across the six amount columns, below the last transaction. Done to show addition. 2.Foot the columns. 3.Test for the equality of debits and credits. $

  21. Section 2 The Cash Receipts Journal (cont'd.) Chapter 16 $ Footing, Totaling, Proving, and Ruling the Cash Receipts Journal (cont'd.) $ 4. In the Date column, on the line below the single rule, enter the date the journal is being totaled. 5. On the same line in the Account Name column, enter the word “Totals.” 6. Enter the columns totals, in ink, just below the footings. 7. Double-rule the amount columns. $ $

  22. Section 2 The Cash Receipts Journal (cont'd.) Chapter 16 $ Posting Column Totals to the General Ledger • There are six amount columns in the cash receipts journal used by On Your Mark. Only five of the column totals, however, are posted to the general ledger. • The total of the General Credit column is not posted. The entries in this column have already been posted, individually, to the general ledger accounts. $ $ $

  23. Section 2 The Cash Receipts Journal (cont'd.) Chapter 16 $ Posting Column Totals to the General Ledger (cont'd.) $ • The total in each of the other five amount columns is posted to the general ledger account named in the column heading. $ $

  24. Section 2 The Cash Receipts Journal (cont'd.) Chapter 16 $ Proving the Accounts Receivable Subsidiary Ledger $ A schedule of accounts receivable is a report listing each charge customer, the balance in the customer’s account, and the total amount due from all customers. $ $

  25. Section 2 The Cash Receipts Journal (cont'd.) Chapter 16 $ Proving the Accounts Receivable Subsidiary Ledger (cont'd.) $ $ $

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