1. Chapter 12: Accounts Receivable

2. ©The McGraw-Hill Companies, Inc. 2 of 46 Accounts Receivable In Chapter 11, you learned how to use Peachtree’s Purchases/Receive Inventory and Payments tasks. Now that you have purchased merchandise from vendors, you are ready to sell that merchandise. To do that, you need to learn how to use Peachtree’s Sales/Invoicing task. Before you can use the Sales/Invoicing task, you need to set up customer defaults, sales tax information, and customer maintenance information. After you set these defaults, Peachtree will use this information when you record a sale.

3. ©The McGraw-Hill Companies, Inc. 3 of 46 Software Objectives, p. 421 Set up customer default information. Set up sales tax information. Set up customer maintenance information. Record credit sales, cash sales, and sales returns. Record customer receipts, partial payments, and edit invoices. Make four backups: 1) back up Chapter 12 beginning data; 2) back up Chapter 12 data; 3) back up Exercise 12-1; 4) back up Exercise 12-2.

4. ©The McGraw-Hill Companies, Inc. 4 of 46 Web Objectives, p. 421 Use your Internet browser to go to the book’s website at www.mhhe.com/yacht2005 www.mhhe.com/yacht2005 Go to the Internet Activity link on the book’s website. Then, select WEB EXERCISES PART 3. Complete the second web exercise in Part 3— WebCPA: Tools and Resources for the Electronic Accountant. Use a word processing program to write summaries of the websites that you visited.

5. ©The McGraw-Hill Companies, Inc. 5 of 46 Peachtree’s Accounts Receivable System, p. 422 Print and send an invoice to your customer. The customer sends you a check to pay the bill. Select the invoice that applies to the customer's check, then select the Pay box.

6. ©The McGraw-Hill Companies, Inc. 6 of 46 Peachtree Tips You must complete Chapter 11 before you start Chapter 12. If the general ledger account (GL account column) is not displayed on the Sales/Invoicing window, check the global options. In the Hide General Ledger Accounts section, all boxes must be unchecked (see p. 54, steps 1-4).

7. ©The McGraw-Hill Companies, Inc. 7 of 46 Backing Up Chapter 12 Backup Name Kilobytes Page Nos. Chapter 12 Begin 248 KB 430-431 Chapter 12 257 KB 458-459 Exercise 12-1 241 KB 465 Exercise 12-2 246 KB 466 The chart below shows the size of the backups made in Chapter 12. The textbook steps show you how to back up to Peachtree’s default hard drive location at C:\Program Files\Peachtree\company\[shortened company name]. You can also specific a hard drive location, or back up to external media such as a floppy disk, Zip disk, CD-R, or USB drive. The chart for the size of all the backups made in Part 3 (Chapters 11-14) is shown on page 362.

8. ©The McGraw-Hill Companies, Inc. 8 of 46 Chapter 12 Topics 1. Software & web objectives, p. 421 2. Getting started, p. 422-423 a. Setting up customer defaults, pp. 424 b. Setting up tax defaults, pp. 425-427 c. Setting up customer maintenance information, pp. 427-430 3. Backing up your data, p. 430-431 4. Recording sales, pp. 431-432 a. Entering invoices for credit sales, pp. 432-433 b. Printing the sales invoice, pp. 433-438 c. Entering a service invoice, pp. 439-441 d. Sales returns: Tasks; Credit Memos, pp. 442- 444.

9. ©The McGraw-Hill Companies, Inc. 9 of 46 Chapter 12 Topics (continued) 5.Recording receipts and cash sales, pp. 445 a. Entering a receipt, pp. 445-448 b. Cash sales, pp. 448-449 c. Finance charges, p. 450 6.Printing customer forms, p. 450 a. Printing invoices, p. 450 b. Printing statements, p. 451 c. Printing mailing labels, pp. 451-452 d. Preparing collection letters, pp. 442-454 7.Printing the sales journal, pp. 454-455

10. ©The McGraw-Hill Companies, Inc. 10 of 46 Chapter 12 Topics (concluded) 8.Printing the cash receipts journal, p. 455-456 9.Printing customer ledgers, p. 456-457 10.Printing the general ledger trial balance, pp. 457 11.Editing receipts, pp. 458 12.Backing up Chapter 12 data, pp. 458-459 13.Internet activity, p. 459 14.Summary and review, pp. 459-460 a.Going to the net, p. 460 b.Multiple-choice questions, pp. 460-463 c. Exercise 12-1, pp. 463-465 d. Exercise 12-2, pp. 465-466 e. Chapter 12 index, p. 467

11. ©The McGraw-Hill Companies, Inc. 11 of 46 Getting started, pp. 422-423 Complete steps 1 – 2k. on p. 422-423. Then, complete steps 1 - 6 for setting up customer defaults on p. 424. This window is shown on p. 424. Click on.

12. ©The McGraw-Hill Companies, Inc. 12 of 46 Setting up sales tax defaults, p. 425-426 Read the instructions on page 425. Then, complete steps 1 – 6 on p. 425 for setting up sales tax defaults. This window is shown on p. 426. Click on Save. Click Close to return to the menu bar.

13. ©The McGraw-Hill Companies, Inc. 13 of 46 Maintain sales tax codes, p. 427 Complete the steps 1-5 on pp. 426-427. Click on Close to return to the menu bar.

14. ©The McGraw-Hill Companies, Inc. 14 of 46 Maintain Customers/Prospects, p. 428 Click on Maintain; Customers/Prospects. Type the customer information shown in step 2 on pp. 427- 428 Click on the Sales Defaults tab.

15. ©The McGraw-Hill Companies, Inc. 15 of 46 Sales defaults, p. 428-429 After selecting the Sales Defaults tab (step 3), complete step 4 on p. 428. This window is shown on p. 428. Click on Save. Then, continue adding customers. Complete step 6 on pages 429-430.

16. ©The McGraw-Hill Companies, Inc. 16 of 46 Backing up your data, p. 430-431 Complete steps 1 – 6 to back up your data. Use Chapter 12 Begin as the back up name.

17. ©The McGraw-Hill Companies, Inc. 17 of 46 Recording sales, p. 431-433 Read the information on pp. 431-433. Then, complete steps 1- 7 on pp. 432-433 for entering invoices for credit sales. This window is shown on p. 433. Continue with steps 4 – 5.m. on pp. 365 and 366.

18. ©The McGraw-Hill Companies, Inc. 18 of 46 Print Forms: Invoices/Pkg. Slips, p. 433-434 To print the sales invoice, follow steps 1, 2, and 3 on pages 433 and 434. Make sure that Invoice Plain Service #2 is highlighted. Click on. Read step 5 on page 434.

19. ©The McGraw-Hill Companies, Inc. 19 of 46 Print Forms: Invoices, pp. 434-435 After completing steps 5 and 6 on p. 434, Invoice Number 101 starts to print. Compare your sales invoice to the one shown on page 435.

20. ©The McGraw-Hill Companies, Inc. 20 of 46 Printing sales invoices, pp. 436-438 Continue entering sales to customers on pages 436-438. Print your sales invoices. Compare them with the ones shown on pages 436-438.

21. ©The McGraw-Hill Companies, Inc. 21 of 46 Entering a service invoice, pp. 439-441 Read the information about service invoices on page 439. Complete steps 1 – 7 on page 439 Compare your invoice to the one shown on p. 441. Complete step 9 on p. 441.

22. ©The McGraw-Hill Companies, Inc. 22 of 46 Sales returns, pp. 442-443 Read the information about sales returns on p. 442. Complete steps 1 – 7 on p. 442. This Credit Memos window is shown on p. 443. Click on Save to post. Then, close. Complete steps 1-6 to apply a sales return, pp. 443-444.

23. ©The McGraw-Hill Companies, Inc. 23 of 46 Receipts window, p. 444 After completing steps 5 and 6 on p. 444, the Receipts window appears. Click on Save to post, then click on the Close icon.

24. ©The McGraw-Hill Companies, Inc. 24 of 46 Entering a receipt, pp. 445 – 446 Read page 445. Then, complete steps 1 – 6 on p. 445. The Receipts window is shown on p. 446. Click on Save to post.

25. ©The McGraw-Hill Companies, Inc. 25 of 46 Partial payment, pp. 446-447 Complete steps 1 – 5 on p. 446-447. Click on Save to post (this is step 6 on p. 447).

26. ©The McGraw-Hill Companies, Inc. 26 of 46 Enter cash sales, pp. 448-449 Read the information about cash sales on p. 448. Complete steps 1- 10 on pages 448 and 449 to enter cash sales.

27. ©The McGraw-Hill Companies, Inc. 27 of 46 Receipts window for cash sale, p. 449 After completing steps 1-10 on pp. 448 and 449, the Receipts window appears. Click on Save to post, then click on the Close icon.

28. ©The McGraw-Hill Companies, Inc. 28 of 46 Printing customer forms, pp. 450-453 Read the information on pages 450-453. Complete steps 1 and 2 on page 453.

29. ©The McGraw-Hill Companies, Inc. 29 of 46 Collection Manager window, p. 453 After completing step 2 on page 453, the Collection Manager window appears. Complete steps 3 – 8 on page 454.

30. ©The McGraw-Hill Companies, Inc. 30 of 46 Printing the sales journal, pp. 454-455 Complete steps 1 – 4 on pp. 454-455 Compare your sales journal to the one shown on p. 455.

31. ©The McGraw-Hill Companies, Inc. 31 of 46 Printing the cash receipts journal, p. 455-456 Complete steps 1 – 3 on pp. 455-456 Compare your cash receipts journal to the one shown on p. 456.

32. ©The McGraw-Hill Companies, Inc. 32 of 46 Printing the customer ledgers, pp. 455-457 Complete steps 1 and 2 on page 456. Compare your printout of the customer ledgers to the one shown on p. 457.

33. ©The McGraw-Hill Companies, Inc. 33 of 46 Printing the general ledger trial balance, p. 457-458 Complete steps 1 and 2 on page 457. Compare your general ledger trial balance to the one shown on p. 457.

34. ©The McGraw-Hill Companies, Inc. 34 of 46 Editing receipts, pp. 458 Click on Tasks; Receipts, Abc Open icon. Highlight Invoice 104, Jane Porter. Click on. The Receipts window appears with Jane Porter’s partial payment of $95.

35. ©The McGraw-Hill Companies, Inc. 35 of 46 Backing Up Chapter 12 Data, pp. 458-459 Complete steps 1 - 6 on pages 458-459. The back up name is Chapter 12. Click on. Compare your check to the one shown on p. 381. Record the additional payments shown on p. 382.

36. ©The McGraw-Hill Companies, Inc. 36 of 46 Glossary of Terms Chapter 12

37. ©The McGraw-Hill Companies, Inc. 37 of 46 Accounts receivable, p. 422 Money that is owed by customers to the business.

38. ©The McGraw-Hill Companies, Inc. 38 of 46 Accounts Receivable transactions, p. 422 Credit transactions from customers. When Richard’s Sales and Service sells merchandise on account to customers, the transactions are known as accounts receivable transactions.

39. ©The McGraw-Hill Companies, Inc. 39 of 46 Invoice, p. 422 A bill that shows an itemized list of goods shipped or services rendered, stating quantities, prices, fees, and shipping charges.

40. ©The McGraw-Hill Companies, Inc. 40 of 46 Cash Receipts Journal, p. 431 A journal used to record all inflows of cash. Peachtree takes the necessary information from the Receipts window and automatically journalizes the transactions in the cash receipts journal.

41. ©The McGraw-Hill Companies, Inc. 41 of 46 Sales journal, p. 431 Sales on account are recorded in the sales journal. In Peachtree, all the information about a sale is recorded in the Sales/Invoicing window. Then, Peachtree takes the necessary information from this window and automatically journalizes the transaction in the sales journal.

42. ©The McGraw-Hill Companies, Inc. 42 of 46 Customer ledger, p. 432 The customer ledger shows account activity for each customer.

43. ©The McGraw-Hill Companies, Inc. 43 of 46 Accounts receivable ledger, p. 432 The accounts receivable ledger shows the account activity for each customer. In Peachtree, this is called the customer ledger.

44. ©The McGraw-Hill Companies, Inc. 44 of 46 Service invoice, p. 439 An alternative to the standard invoice. Use it when you want to create an invoice without inventory items. Matt's Service Merchandise sells and repairs household items. When repairs are done, a service invoice is used.

45. ©The McGraw-Hill Companies, Inc. 45 of 46 1 Go to the book’s website at www.mhhe.com/yacht2005 www.mhhe.com/yacht2005 2 In the Student Center list, link to Internet Activities. 3 Link to WEB EXERCISES PART 3. 4 Complete the WebCPA—Tools and Resources for Electronic Accountant exercise. Read steps 1-3. 5 Follow the steps shown on the book’s website to complete this Internet activity. 6 Using a word processing program, write a brief summary of what you find. Include all appropriate website addresses. Internet Activity, p. 459

46. ©The McGraw-Hill Companies, Inc. 46 of 46 Going to the Net, p. 460 Access the Business Owner’s Toolkit website at www.toolkit.cch.com/text/P06_1430.asp www.toolkit.cch.com/text/P06_1430.asp Read the accounts receivable page. 1. What is the common abbreviation for accounts receivable? 2. What is the control account for customer sales on account? 3. How is the ending accounts receivable total computed?