Posting from a Cash Payments Journal to an Accounts Payable Ledger Lesson 9-5 Posting from a Cash Payments Journal to an Accounts Payable Ledger LO10 Individual amounts in Accounts Payable Debit column posted frequently to proper vendor accounts in accounts payable ledger. Business must monitor outstanding accounts payable balances to ensure it can continue to purchase goods and services on account Many vendors establish limits on outstanding balances of customers A credit limit is the maximum outstanding balance allowed to a customer by a vendor.

Posting from a Cash Payments Journal to an Accounts Payable Ledger Lesson 9-5 Posting from a Cash Payments Journal to an Accounts Payable Ledger LO10 2 Journal Page Number 3 Debit 1 Date 5 Vendor Number 4 Account Balance

Posting from the General Amount Columns of a Cash Payments Journal to a General Ledger Each amount in General columns of cash payments journal posted individually to general ledger account written in Account Title column

Lesson 9-5 Posting from the General Amount Columns of a Cash Payments Journal to a General Ledger LO10 2 Journal Page Number 3 Debit 1 Date 5 Vendor Number 4 Account Balance

Informal Writing Summarize the process for posting from the cash payments journal to the subsidiary and general ledgers in three bullet points

Totaling, Proving, and Ruling a Cash Payments Journal Journal proved and ruled whenever journal page is filled and always at end of month Total for each column written in next available line Totals used to prove debits equal credits Common errors include entering amounts incorrectly and entering correct amount in wrong column or even wrong journal

Totaling, Proving, and Ruling a Cash Payments Journal Lesson 9-5 Totaling, Proving, and Ruling a Cash Payments Journal LO10 3 Single Rule 1 Date 2 “Totals” 4 Column Total 5 Double Rule

Totals of General amount columns not posted Posting from the Special Amount Columns of a Cash Payments Journal to a General Ledger Total of each special amount column…posted to account names in column’s heading… whenever page is filled and at end of month Totals of General amount columns not posted Each amount in these columns posted individually to general ledger account To indicate these totals are not posted, check mark placed in parentheses below each column total

Lesson 9-5 Posting from the Special Amount Columns of a Cash Payments Journal to a General Ledger LO10 Journal Page Number 2 3 Debit or Credit Amount 1 Date 5 Account Number 4 Account Balance 5 5 1 2 3 4 1 2 3 4

Completed Accounts Payable Ledger Lesson 9-5 Completed Accounts Payable Ledger LO10

Proving the Accounts Payable Ledger Lesson 9-5 Proving the Accounts Payable Ledger LO10 Controlling account balance in general ledger…must equal sum of all account balances in subsidiary ledger A listing of vendor accounts, account balances, and the total amount due to all vendors is called a schedule of accounts payable. Also known as an account payable trial balance Schedule of accounts payable is prepared after all entries in all journals are posted

Proving the Accounts Payable Ledger Lesson 9-5 Proving the Accounts Payable Ledger LO10

Lesson 9-5 Audit Your Understanding 1. In which column of the cash payments journal are the amounts that are posted individually to the accounts payable ledger? ANSWER Accounts Payable Debit

Lesson 9-5 Audit Your Understanding 2. List the five steps for ruling a cash payments journal at the end of the month. ANSWER 1. Rule a single line across all amount columns. 2. Write the date in the Date column. 3. Write Totals in the Account Title column. 4. Write each column total below the single line. 5. Rule a double line across all amount columns.

Lesson 9-5 Audit Your Understanding 3. What is the relationship between a controlling account and a subsidiary ledger? ANSWER A controlling account balance in a general ledger must equal the sum of all account balances in a subsidiary ledger.

Numbered Heads Together Work in teams of five to complete 9-5 Work Together If everyone receives 100% and your team completes it faster than the other team, your group will receive air heads Not only do you need to receive 100% across the entire team, but you also need to make sure each team member can explain the process of posting from the sales journal to either the General Ledger or Subsidiary Ledger Once we are finished, we will follow the same procedure for 9-5 OYO (10 mins)

Proper Order Place the index cards with different stages of posting from the cash payments journal in proper sequence First group to finish first wins! Flash Card Review Game Each student approaches board to flip over a new card If answered correctly, student gets 5 points If not, receive nothing Students with most points get Starbursts (Jess needs to receive her amount)

Closure Are credit limits helpful or more harmful? Why? How can you ensure payment?