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Chapter 12: Vendors & Purchases

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1 Chapter 12: Vendors & Purchases
Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

2 Vendors & Purchases Chapter 12 begins Part 3 of the book: Sage for Merchandising Businesses. Merchandising businesses are retail stores that resell goods and services. In Chapter 12, you set up two merchandising businesses: Wendy’s Service Merchandise, a partnership owned by Alex Ziegler and Wendy Lincoln; and Student Name [use your last name] Sales and Service, a sole proprietorship. Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

3 Accounts Payable Transactions
Vendor sends Wendy's Service Merchandise an invoice. You enter the invoice as a purchase. When it is time to pay the invoice, you select the invoice(s) from the vendor you want to pay and print a check. Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

4 Sage 50 Tips In Chapter 12, you set up two merchandising businesses: Wendy’s Service Merchandise and the end-of-chapter exercise, Student Name Sales and Service (Exercises 12-1 and 12-2). The companies that you set up in Chapter 12, continue in Chapters 13, 14 and 15. If the general ledger account (GL account field) is not displayed on the Purchases/Receive Inventory window or Payments window, check the global options. In the Hide General Ledger Accounts section, all boxes must be unchecked. Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

5 Sage 50 Tips (continued) What if you want to use Wendy’s Service Merchandise on a computer that does not have this company set up in Sage 50?   If you start Sage 50 and the appropriate company cannot be opened, use the Restore Wizard to select Create a new company using the restored data. The Create a new company using the restored data selection allows you to restore your backup data, and set up the company . If Wendy’s Service Merchandise (or another name Service Merchandise) is not listed either on the Open an Existing Company window or when you select <Browse>, click Cancel > then Close. From Sage 50’s startup window, there are four menu bar options— File, Options, Services, Help — Select File > Restore. Restore the appropriate backup file using the Create a new company using the restored data selection. This allows you to bypass creating a new Sage 50 company and restore the company data from a backup file (.ptb extension). Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

6 Backing Up and Saving Files in Chapter 12 Part 3 Introduction
Backup (.ptb) Excel (.xlsx) and Adobe (.pdf) Kilobytes Page Nos. Chapter 12 Chart of Accounts.ptb 924 KB 414 Chapter 12 Starting Balance Sheet.ptb 927 KB 417 Chapter 12 Begin.ptb 992 KB 431 Chapter 12.ptb 1,068 KB 455 Chapter 12_CofA_PJ_CDJ_VL_GLTB.xlsx 28 KB Exercise 12-1 Chart of Accounts.ptb 912 KB 460 Exercise 12-1_Starting Balance Sheet.ptb 913 KB 462 Exercise 12-1.ptb 922 KB 465 Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

7 Backing Up and Saving Files Chapter 12 (concluded)
Adobe (.pdf) Kilobytes Page Nos. Exercise 12-2.ptb 939 KB 467 Exercise 12-1_CofA_PJ_CDJ_VL_GLTB.xlsx 27 KB Exercise 12-2_Chart of Accounts.pdf 11 KB Exercise 12-2_Purchase Journal.pdf 12 KB Exercise 12-2_Cash Disbursements Journal.pdf Exercise 12-2_Vendor Ledgers.pdf 6 KB Exercise 12-2_General Ledger Trial Balance.pdf Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

8 How the purchases and payments tasks work together
Purchases/Receive Inventory Enter the Vendor Invoice Payments Apply the Vendor Invoice as a Check Print Checks Print the Disbursement Check Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

9 Microsoft Dynamics, etc.
Accounting Software Sage 50, QuickBooks Desktop and QuickBooks Online are used by small companies. As the company grows to mid-size, Sage 50, Microsoft Dynamics, and NetSuite can be used. Large companies use MS Dynamics, Oracle and SAP. As companies grow in size, their accounting software needs change. Company size No. of employees Small 1-50 Medium 50-500 Large 500+ QuickBooks Sage 50 Microsoft Dynamics, etc. Small companies to Large companies Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

10 Glossary of Terms Chapter 12
Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

11 Vendors Merchandising businesses purchase the merchandise they sell from suppliers known as vendors. Wendy’s Service Merchandise vendors are shown below. Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

12 Accounts payable transactions
Purchases of merchandise for resale, assets, or expenses incurred on credit from vendors. When Wendy’s Service Merchandise makes purchases on account from vendors, the transactions are known as accounts payable transactions. Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

13 Accounts payable The money a company owes to a supplier or vendor.
Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

14 Database An organized body of related information. As the database gets larger, the depth of processing increases and more features and functions are available. Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

15 Purchase Journal In Sage 50, the Purchases/Receive Inventory window is the purchase journal. In the Purchase Journal, or Purchases/Receive Inventory window, you can enter invoices from vendors or enter and print purchase orders. Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

16 Purchases/Receive Inventory window is Sage 50’s Purchase Journal
Copyright ©2017 by McGraw-Hill Education. All rights reserved.

17 Accounts payable ledger
Shows the account activity for each vendor. Same as vendor ledger. Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

18 Vendor ledger Shows the account activity for each vendor. The vendor ledger is also called the accounts payable ledger. Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

19 Average cost A method of computing inventory. See weighted-average method on the next slide. Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

20 Weighted-average method
This method of inventory pricing divides the cost of the inventory purchased by the quantity of merchandise purchased. This unit cost is multiplied by the ending inventory. Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

21 Cash disbursements journal
All payments of cash are recorded in the cash disbursements journal. In Sage 50, the Write Checks and Payments tasks are recorded in the cash disbursements journal. Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

22 Payments window Cash Disbursements Journal
The payments window shows a payment to a vendor minus a return and purchase discount. Copyright ©2017 by McGraw-Hill Education. All rights reserved.

23 Online Learning Center
Go online to for additional resources. Link to Student Edition, select Chapter 12. Interactive Testing: Online multiple-choice and true and false questions. Tests are graded and can be ed to instructor. Glossary of Terms: Words that are boldfaced and italicized within the chapter are defined in the glossary. Narrated PowerPoints Assessment Rubrics: Reviews journal entries, reports, navigation centers, modules, and task windows. Going to the Net: Internet research. Videos: Demonstration of backup, restore, and global options. There are also YouTube video selections. QA Templates: Chapter questions and analysis question. Frequently Asked Questions (FAQs): Common questions and their answers. Troubleshooting: Tips for using Sage 50. Review of Accounting Principles: Read the review of accounting principles. Copyright ©2017 by McGraw-Hill Education. All rights reserved.

24 Going to the Net Watch the Basics for New Users – Sage 50 Tutorials video. Briefly describe what the video covers. Copyright ©2017 by McGraw-Hill Education. All rights reserved. Copyright (c)2016 McGraw-Hill Education. All rights reserved.

25 Analysis Question What is the balance in the Accounts Payable account, Wendy’s Service Merchandise? Why? Copyright ©2017 by McGraw-Hill Education. All rights reserved.

26 Navigation Center/Module
Assessment Rubric Date Transaction Navigation Center/Module Task Window Journal Dr./Cr. 1/4 Invoice No. 480CP was received from Curt Perkins Tools for the purchase of 10 tool kits for a unit cost of $30. 1/6 Returned two tool kits to Curt Perkins Tools, Invoice No. 480CP. Paid $30 for each tool kit: VCM480CP. 1/11 Issued Check No to Curt Perkins Tools for merchandise purchased on January 3, less the January 6 return, Invoice No. 480CP. Copyright ©2017 by McGraw-Hill Education. All rights reserved.

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