1. © 2007 McGraw-Hill Ryerson Ltd.
Electronic Presentations in Microsoft® PowerPoint®
Accounting Information Systems
C H A P T E R 8
Slides Content
1-3 Learning objectives
4-7 MIS & AIS
Accounting and technology
Special journals and subledgers
Mini-quiz
Sales journal
Cash receipts journal
Purchase journal
Cash disbursements journal
General journal
35 Mini-quiz
Appendix 8A
Appendix 8B
Review
End
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2. © 2007 McGraw-Hill Ryerson Ltd.
Learning Objectives
Explain the relationship of the accounting information system to the management information system and identify the components of an AIS
Explain the goals and uses of special journals.
Describe the use of controlling accounts and subledgers.
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3. © 2007 McGraw-Hill Ryerson Ltd.
Learning Objectives
Journalize and post transactions using special journals.
Prepare and test the accuracy of subledgers.
Apply journalizing and posting of transactions using special journals in a periodic inventory system. (Appendix 8A)
Journalize and post transactions with sales taxes to special journals. (Appendix 8B)
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4. Management Information Systems
A system designed to collect and process data within an organization for the purpose of providing users with information.
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5. Management Information System
Internal
External
Community
Competitors
Customers
Government
Industry
Suppliers
Sales and Marketing System
Finance System
Accounting Information System
Human Resources System
Production System
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6. Accounting Information Systems (AIS)
The people, records, methods, and equipment that collect and process data from transactions and organize them in useful forms, and communicate results to decision makers.
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7. Accounting Information System
Components of an AIS
Feedback Loop
Accounting Information System
Accounts Payable
Payroll
Capital Assets
Accounts Receivable
Outputs
Reports/ Information to Internal/ External Users
Inputs
Source Documents
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8. Accounting and Technology
Impact of technology-based systems on accounting.
Electronic funds transfer (EFT)
E-commerce
Computer hardware
Computer software
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9. © 2007 McGraw-Hill Ryerson Ltd.
Special Journals
Most organizations use Special Journals to enhance efficiency of transaction processing.
Types
Sales Journal
Cash Receipts Journal
Purchases Journal
Cash Disbursements Journal
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10. © 2007 McGraw-Hill Ryerson Ltd.
Subledgers
A listing of individual accounts with a common characteristic.
Common Subledgers
Accounts Receivable
Accounts Payable
Inventory
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11. Accounts Receivable Subledger
A separate subledger account is used to show how much each individual customer owes.
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12. Accounts Receivable Subledger
After all items are posted, the balance in the Accounts Receivable controlling account must equal the sum of the balances in the subledger.
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13. © 2007 McGraw-Hill Ryerson Ltd.
Mini-Quiz
A subsidiary ledger:   
A) Includes transactions not covered by special journals.  
B) Is a listing of all of the accounts of a business.  
C) Is a listing of individual accounts with a common characteristic.  
D) Is a listing of all accounts with balances.  
E) Is a listing of all special journals.
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14. © 2007 McGraw-Hill Ryerson Ltd.
Mini-Quiz
A subsidiary ledger:   
A) Includes transactions not covered by special journals.  
B) Is a listing of all of the accounts of a business.  
C) Is a listing of individual accounts with a common characteristic.  
D) Is a listing of all accounts with balances.  
E) Is a listing of all special journals.
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15. © 2007 McGraw-Hill Ryerson Ltd.
Sales Journal
The sales journal is used to record sales of merchandise on credit.
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16. Sales Journal — Example
On February 2, Jason Henry purchased $450 of merchandise on account from Outdoors Unlimited. The goods originally cost Outdoors $315. Record the entry in the Sales Journal.
(Assume the use of a perpetual inventory system.)
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17. © 2007 McGraw-Hill Ryerson Ltd.
Sales Journal
Since each transaction yields a debit to Accounts Receivable and a credit to Sales, we need only one column for these two accounts. This column total is posted monthly.
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18. © 2007 McGraw-Hill Ryerson Ltd.
Sales Journal
Similarly, each transaction yields a debit to Cost of Goods Sold and a credit to Inventory. Therefore, these accounts can also be included together in one column. This column total would also be posted monthly.
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19. © 2007 McGraw-Hill Ryerson Ltd.
Sales Journal
Daily, each transaction is posted to the appropriate Accounts Receivable subledger account.
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20. © 2007 McGraw-Hill Ryerson Ltd.
Sales Journal
A  in the PR column indicates the transaction has been posted to the subledger account.
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21. Here is the Sales Journal after recording some additional sales.
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22. On Feb. 28th , post the column total to Accounts Receivable and Sales.
Sales Journal
On Feb. 28th , post the column total to Accounts Receivable and Sales.
2011
Feb S , ,150
2011
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Feb S , ,150

23. Now post to the COGS and Inventory accounts …
Sales Journal
Now post to the COGS and Inventory accounts …
2011
Feb S , ,500
2011
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Feb S , ,500

24. … and include the posting references.
Sales Journal
… and include the posting references.
2011
Feb S , ,500
2011
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Feb S , ,500

25. © 2007 McGraw-Hill Ryerson Ltd.
Testing the Ledger
The Accounts Receivable controlling account and the subledger are in balance.
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26. Sales Returns and Allowances
If a company has few sales returns, they may record them in the General Journal.
But, if a company has lots of sales returns, they may use a Sales Returns and Allowances Journal.
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27. © 2007 McGraw-Hill Ryerson Ltd.
Cash Receipts Journal
The cash receipts journal is used to record all receipts of cash.
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28. Cash Receipts Journal — Example
Categories of Cash Receipts
Cash from cash sales
Cash from credit customers
Cash from other sources
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29. © 2007 McGraw-Hill Ryerson Ltd.
Cash Receipts Journal
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30. © 2007 McGraw-Hill Ryerson Ltd.
Purchases Journal
The Purchases Journal is used to record all purchases on credit.
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31. © 2007 McGraw-Hill Ryerson Ltd.
Purchases Journal
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32. Cash Disbursements Journal
The Cash Disbursements Journal is used to record all payments of cash.
Outdoors Unlimited
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33. Cash Disbursements Journal
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34. © 2007 McGraw-Hill Ryerson Ltd.
General Journal
Used for all transactions not recorded in a special journal.
Closing entries
Adjusting entries
Correcting entries
Other entries
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35. © 2007 McGraw-Hill Ryerson Ltd.
Mini-Quiz
Give the name of the journal in which the following transactions should be recorded.
Purchased equipment on credit.
Sold merchandise for cash.
Paid for supplies that were purchased on account.
Sold merchandise on account. PJ
CRJ
CDJ SJ
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36. Special Journals Under a Periodic System-Appendix 8A
Recording and posting is similar to a perpetual system.
Some of the columns change in a periodic system.
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37. Sales Journal — Periodic System
The column for Cost of Goods Sold and Inventory is not needed with the periodic system.
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38. Cash Receipts Journal Periodic System
The column for Cost of Goods Sold and Inventory is not needed with the periodic system.
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39. Purchases Journal — Periodic System
The Inventory column in the perpetual system is replaced with Purchases column in the periodic system.
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40. Cash Disbursements Journal Periodic System
The Inventory column in the perpetual system is replaced with Purchases Discounts column in the periodic system.
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41. Special Journals and Sales Taxes- Appendix 8B
Additional columns must be added to special journals to record PST and GST.
Column Needed
Journal
PST Payable
GST
Payable
GST Receivable
Sales
yes
Cash Rec.
Purchases
Cash Disb.
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42. © 2007 McGraw-Hill Ryerson Ltd.
Review
Identify the different types of special journals?
Sales journal
Cash receipts journal
Purchases journal
Disbursements journal
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43. © 2007 McGraw-Hill Ryerson Ltd.
Review
What is the purpose of special journals?
Special journals help reduce the costs related to the time and effort of posting accounts.
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44. © 2007 McGraw-Hill Ryerson Ltd.
Review
Why should sales to and receipts of cash from credit customers be recorded and posted daily?
Daily recording and posting of credit sales and cash receipts from customers provides up-to-date information used in decisions about granting credit to customers. Also, up-to-date account balances are needed if customers inquire about the amount of their balances.
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45. © 2007 McGraw-Hill Ryerson Ltd.
End of Chapter
© 2007 McGraw-Hill Ryerson Ltd.