Accounting 3 Chapter 19 Section 1

Sales Journal This journal is used only to record sales of merchandise on account. This journal is used only to record sales of merchandise on account. If a sale is paid for in cash, it does not get recorded in this journal. If a sale is paid for in cash, it does not get recorded in this journal.

Journalizing Sales on Account When sales are made on account, sales tax and total invoice amount must be calculated and recorded properly. When sales are made on account, sales tax and total invoice amount must be calculated and recorded properly. Formulas: Formulas: –Sales Invoice Amount x Sales Tax Rate= Sales Tax Payable. –Sales Invoice Amount + Sales Tax Payable= Total Invoice Amount. Example transaction and visual steps on next slide. Example transaction and visual steps on next slide.

March 2. Sold merchandise on account to Tennis Castle, $1, plus sales tax, $144.00; total, $1, Sales Invoice No (Sales tax rate was 8%) Sales Journal Page ___ DateAccount Debited Post Ref. Sales Tax Payable Credit Sale No. Accts Rec Debit Sales Credit Mar2 Tennis Castle *If there is a transaction in which you do not have the total invoice amount given to you, it may be helpful to fill in the sales credit first, then figure the sales tax and enter it, then figure your total and enter it. 7

Posting from a Sales Journal to the Accounts Receivable and General Ledger When posting a sales journal entry, the amount in the Accounts Receivable Debit column will go into the respective Customer account in the Accounts Receivable Ledger. When posting a sales journal entry, the amount in the Accounts Receivable Debit column will go into the respective Customer account in the Accounts Receivable Ledger. At the end of the fiscal period, the totals of the special columns will go into their respective accounts in the general ledger. At the end of the fiscal period, the totals of the special columns will go into their respective accounts in the general ledger. An example of this will be in the Work Together problem. An example of this will be in the Work Together problem.

Work Together p. 492 Sales Journal Page ___ DateAccount Debited Post Ref. Sales Tax Payable Credit Sale No. Accts Rec Debit Sales Credit Apr2Northland Hospital Blanton College Belmont Water Association Tess and Sons Totals (1125) (4105) (2135) 4 View the postings after you have reviewed each entry by clicking on the hyperlink. Assignment

CustomerCust No. DateItem Post Ref DebitCredit Debit Balance CustomerCust No. DateItem Post Ref DebitCredit Debit Balance Belmont Water Association110 Apr 1 Balance S S Blanton College120 Apr 1 Balance S Accts Rec Ledger

CustomerCust No. DateItem Post Ref DebitCredit Debit Balance CustomerCust No. DateItem Post Ref DebitCredit Debit Balance Accts Rec Ledger Northland Hospital160 Apr 1 Balance S Tess & Sons190 Apr 1 Balance S

Account Acct No. DateItem Post Ref DebitCredit BALANCE DEBITCREDIT Account Acct No. DateItem Post Ref DebitCredit BALANCE DEBITCREDIT General Ledger Accounts Receivable 1125 Apr 1 Balance S Sales Tax Payable 2135 Apr 1 Balance S

Account Acct No. DateItem Post Ref DebitCredit BALANCE DEBITCREDIT General Ledger Sales 4105 Apr 1 Balance S

Assignment Do Application 19-1 by hand. Do Application 19-1 by hand. Turn it into Mrs. Middleton. Turn it into Mrs. Middleton. Move on to Section 2. Move on to Section 2.