CENTURY 21 ACCOUNTING © Thomson/South-Western LESSON 11-1 Journalizing Sales on Account Using a Sales Journal

CENTURY 21 ACCOUNTING © Thomson/South-Western 2 LESSON 11-1 SALES TAX

CENTURY 21 ACCOUNTING © Thomson/South-Western 3 LESSON 11-1 SALES OF MERCHANDISE ON ACCOUNT

CENTURY 21 ACCOUNTING © Thomson/South-Western 4 LESSON 11-1 SALES JOURNAL

CENTURY 21 ACCOUNTING © Thomson/South-Western 5 LESSON1 SALES INVOICE

CENTURY 21 ACCOUNTING © Thomson/South-Western 6 LESSON 11-1 SALE ON ACCOUNT November 3. Sold merchandise on account to Village Crafts, $540.00, plus sales tax, $32.40; total, $ Sales Invoice No Write the date. 6. Write the sales tax amount. 2. Write the customer name. 3. Write the sales invoice number. 4. Write the total amount owed by the customer. 5. Write the sales amount.

CENTURY 21 ACCOUNTING © Thomson/South-Western 7 LESSON 11-1 TOTALING, PROVING, AND RULING A SALES JOURNAL

CENTURY 21 ACCOUNTING © Thomson/South-Western 8 LESSON 11-1 TERMS REVIEW Customer A person or business to whom merchandise or services are sold. sales tax A tax on a sale of merchandise or services sales journal A special journal used to record only sales of merchandise on account.

CENTURY 21 ACCOUNTING © Thomson/South-Western Audit Your Understanding 11-1 How does a merchandising business differ from a service business? Sells merchandise vs services How are sales tax rates usually stated? % of sales Why is sales tax collected considered a liability? Something owed to the government What is the title of the general ledger account used to summarize the total amount due from all charge customers? Accounts Receivable 9 LESSON 11-1

CENTURY 21 ACCOUNTING © Thomson/South-Western LESSON 11-2 Journalizing Cash Receipts Using a Cash Receipts Journal

CENTURY 21 ACCOUNTING © Thomson/South-Western 11 LESSON 11-2 PROCESSING SALES TRANSACTIONS UPC (Universal Product Code) Cash Register Receipt Point-of-Sale (POS) Terminal Receipt (continued on next slide)

CENTURY 21 ACCOUNTING © Thomson/South-Western 12 LESSON 11-2 PROCESSING SALES TRANSACTIONS Terminal Summary Batch Report (continued from previous slide)

CENTURY 21 ACCOUNTING © Thomson/South-Western 13 LESSON 11-2 CASH RECEIPTS JOURNAL

CENTURY 21 ACCOUNTING © Thomson/South-Western 14 LESSON 11-2 CASH AND CREDIT CARD SALES November 4. Recorded cash and credit card sales, $5,460.00, plus sales tax, $327.60; total, $5, Terminal Summary Write the date. 2.Place a check mark in the Account Title column. 3.Write the terminal summary document number. 4.Place a check mark in the Post. Ref. column. 5.Write the sales amount. 6.Write the sales tax amount. 7.Write the cash amount. 7

CENTURY 21 ACCOUNTING © Thomson/South-Western 15 LESSON 11-2 CASH RECEIPTS ON ACCOUNT November 6. Received cash on account from Country Crafters, $2,162.40, covering S69. Receipt No Write the date. 2.Write the customer’s name. 3.Write the receipt number. 4.Write the credit amount. 5.Write the debit amount.

CENTURY 21 ACCOUNTING © Thomson/South-Western 16 LESSON 11-2 JOURNALIZING CASH RECEIPTS ON ACCOUNT WITH SALES DISCOUNTS November 7. Received cash on account from Cumberland Center, $1,176.00, covering Sales Invoice No. 74 for $1,200.00, less 2% discount, $ Receipt No Write the original invoice amount.1.Write the date. 2.Write the customer’s name. 3.Write the receipt number. 5.Write the amount of sales discount. 6.Write the debit to cash.

CENTURY 21 ACCOUNTING © Thomson/South-Western 17 LESSON 11-2 TOTALING, PROVING, AND RULING A CASH RECEIPTS JOURNAL

CENTURY 21 ACCOUNTING © Thomson/South-Western 18 LESSON 10-1 TERMS REVIEW cash sale A sale in which cash is received for the total amount of the sale at the time of the transaction credit card sale A sale in which a credit card is used for the total amount of the sale at the time of the transaction cash receipts journal A special journal used to record only cash receipt transactions

CENTURY 21 ACCOUNTING © Thomson/South-Western Audit Your Understanding – 11-2 What accounts are increased and decreased when cash is received on account? Cash is debited, and accounts receivable is credited What is written in the cash receipts journal’s Account Title column for a cash and credit sales transaction? A check mark Describe how to prove cash. Cash on hand at the beginning of the month, plus total cash received during the month, less total cash paid during the month, equals cash balance on hand at the end of the month. Cash is proved if the balance on the next used check stub is the same as the cash proof. 19 LESSON 10-1