Special Journals: Sales and Cash Receipts Chapter 16

Using Special Journals Special journals have amount columns that are used to record debits and credits to specific general ledger accounts Most transactions are recorded on one line Special journals simplify the journalizing and posting process Using Special Journals Journal Transaction Sales journal Sale 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 payment by check Pg 450

Journalizing and Posting to the Sales Journal Sales journal is for recording sales of merchandise on account Pgs 450-453

Completing the Sales Journal All special journals have amount columns used to record debits and credits to specific general ledger accounts. Instead of posting each transaction separately to the general ledger, the column totals are posted. Therefore, only three postings are made to the general ledger from the sales journal. Pg 453

Pg 454-455

Posting Sales Tax Payable and Accounts Receivable Totals Pgs 455-456

Forwarding Totals to New Page Pg 457

Cash Receipts Journal Pg 459-460 To keep the customer account balances current, the entries in the AT Credit column are posted daily to the Accounts Receivable Subsidiary Ledger. The entries in the General Credit column are posted daily to the individual general ledger accounts At month-end, all special amount column totals are posted to the general ledger accounts named in the headings.

Receiving Cash for payment of Accounts Receivable Receiving Cash for Payment of Accounts Receivable with Discount Receiving Cash for Sales Pgs 460-461

Bankcard Sales Receipt of cash for other than AR or Bankcard Pgs462-463

Posting to the Accounts Receivable Subsidiary Ledger Posting to the General Ledger Pgs 463-464

Completed Cash Receipt Journal The only column not posted as a total is the General Credit column. Those transactions are posted individually. Pg 465

Proving the AR Subsidiary Ledger The Accounts Receivable account is the Controlling Account for all AR Subsidiary Accounts All accounts are included in alphabetical order, even those with a zero balance. The Schedule of Accounts Receivable report is usually prepared at the end of each month. Pg 466

Schedule of Accounts Receivable Pgs 467-468

Detecting Errors in the Subsidiary Ledger Proving the AR Subsidiary Ledger with the controlling account verifies that the sum of the subsidiary ledger equals the controlling account’s ending balance. Certain errors will be apparent such as: a transaction that wasn’t posted or a miscalculation of account balance. It doesn’t ensure that transactions were posted to the correct customer account. Pg 468