1. Chapter 12: Accounts Receivable

3. ©The McGraw-Hill Companies, Inc., 2004 3 of 48 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.

4. ©The McGraw-Hill Companies, Inc., 2004 4 of 48 Software Objectives, p. 429 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: 2 for Jessica's Sales & Service; 2 for the end-of-chapter exercises.

5. ©The McGraw-Hill Companies, Inc., 2004 5 of 48 Web Objectives, p. 429 Use your Internet browser to go to the book’s website at www.mhhe.com/yacht2003 www.mhhe.com/yacht2003 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, “The Accountant’s Web Magazine and Resource Guide: Faulkner & Gray’s Electronic Accountant.” Use a word processing program to write summaries of the websites that you visited.

6. ©The McGraw-Hill Companies, Inc., 2004 6 of 48 Peachtree’s Accounts Receivable System, p. 430

7. ©The McGraw-Hill Companies, Inc., 2004 7 of 48 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. 52, steps 1-4).

8. ©The McGraw-Hill Companies, Inc., 2004 8 of 48 Backing Up Chapter 12 Disk Backup Name KB Page Nos. 17 of 18 A:\Chapter 12 Begin 111 KB 448 A:\Chapter 12 118 KB 469-470 A:\Exercise 12-1 101 KB 476 A:\Exercise 12-2 105 KB 477 TOTAL KB 435 KB.

9. ©The McGraw-Hill Companies, Inc., 2004 9 of 48 Chapter 12 Topics 1. Software & web objectives, p. 429 2. Getting started, p. 431 a. Setting up customer defaults, pp. 431-433 b. Setting up tax defaults, pp. 433-435 c. Setting up customer maintenance information, pp. 435-439 3. Recording sales, pp. 439-440 a. Entering invoices for credit sales, pp. 440-441 b. Printing the sales invoice, pp. 442-447 c. Backing up your data, p. 448 d. Entering a service invoice, pp. 448-450 e. Sales returns, pp. 451-454

10. ©The McGraw-Hill Companies, Inc., 2004 10 of 48 Chapter 12 Topics (continued) 4. Recording receipts and cash sales, p. 455 a. Entering a receipt, pp. 455-458 b. Cash sales, pp. 458-460 c. Finance charges, p. 460 5. Printing customer forms, p. 460 a. Printing invoices, p. 460 b. Printing statements, p. 461 c. Printing mailing labels, pp. 461-462 d. Preparing collection letters, pp. 462-464 6. Printing the sales journal, pp. 464-465

11. ©The McGraw-Hill Companies, Inc., 2004 11 of 48 Chapter 12 Topics (concluded) 7. Printing the cash receipts journal, p. 466 8. Printing customer ledgers, p. 467 9. Printing the general ledger trial balance, pp. 467-468 10. Editing receipts, pp. 468-469 11. Backing up Chapter 12 data, pp. 469-470 12. Internet activity, p. 470 13. Summary and review, pp. 470-471 a.Going to the net, p. 471 b.Multiple-choice questions, pp. 471-474 c. Exercise 12-1, pp. 474-476 d. Exercise 12-2, pp. 476-477 e. Chapter 12 index, p. 478

12. ©The McGraw-Hill Companies, Inc., 2004 12 of 48 Getting started, p. 431 Complete steps 1 – 2j on p. 431. Then, complete steps 1 - 5 for setting up customer defaults on pp. 431 and 432. Click on.

13. ©The McGraw-Hill Companies, Inc., 2004 13 of 48 Setting up sales tax defaults, p. 433 Read the instructions on page 433. Then, complete steps 1 – 5 on p. 433 for setting up sales tax defaults. Click on Save. Complete step 6 on page 434. Click Close to return to the menu bar.

14. ©The McGraw-Hill Companies, Inc., 2004 14 of 48 Maintain sales tax codes, p. 435 Complete the steps 1-5 on pages 434-435. Click on “Close” to return to the menu bar.

15. ©The McGraw-Hill Companies, Inc., 2004 15 of 48 Maintain Customers/Prospects, p. 436 Click on Maintain, then Customers/Prospects. Type the customer information shown in step 2 on pp. 435- 436. Click on the “Sales Defaults” tab.

16. ©The McGraw-Hill Companies, Inc., 2004 16 of 48 Sales defaults, p. 437 After selecting the “Sales Defaults” tab (step 3), complete step 4 on p. 436. Click on Save. Then, continue adding customers. Complete step 6 on pages 437 – 439.

17. ©The McGraw-Hill Companies, Inc., 2004 17 of 48 Recording sales, p. 439-440 Read the information on pp. 439 and 440. Then, complete steps 1- 7 on pp. 440 and 441 for entering invoices for credit sales. Continue with steps 4 – 5.m. on pp. 365 and 366.

18. ©The McGraw-Hill Companies, Inc., 2004 18 of 48 Print Forms: Invoices/Pkg. Slips, p. 442 To print the sales invoice, follow steps 1, 2, and 3 on page 442. Make sure that “Invoice Plain Service #2” is highlighted. Click on. Read step 5 on page 442.

19. ©The McGraw-Hill Companies, Inc., 2004 19 of 48 Print Forms: Invoices, p. 443 Complete step 5 on p. 442. Then, compare your screen to the one shown on p. 443. Click on. Compare your sales invoice with the one shown on page 444.

20. ©The McGraw-Hill Companies, Inc., 2004 20 of 48 Printing sales invoices, pp. 445-447 Continue entering sales to customers on pages 445 – 447. Print your sales invoices. Compare them with the ones shown on pages 445 – 447.

21. ©The McGraw-Hill Companies, Inc., 2004 21 of 48 Backing up your data, p. 448 Complete steps 1 – 9 to back up your data. Use Chapter 12 Begin as the back up name.

22. ©The McGraw-Hill Companies, Inc., 2004 22 of 48 Entering a service invoice, pp. 448-450 Read the information about service invoices on page 448 and 449. Complete steps 1 – 8 on pages 449 and 450. Compare your invoice to the printout shown on p. 450. Complete step 9 on p. 450.

23. ©The McGraw-Hill Companies, Inc., 2004 23 of 48 Sales returns, pp. 451-452 Read the information about sales returns on p. 451. Complete steps 1 – 6 on pp. 451 and 452. Click on Save to post. Then, close.

24. ©The McGraw-Hill Companies, Inc., 2004 24 of 48 Credit card window, p. 453 Complete steps 1 - 6 on p. 453. The “Credit Card Information” screen appears. Complete steps 7 – 10 on pages 453-454.

25. ©The McGraw-Hill Companies, Inc., 2004 25 of 48 Receipts window, p. 454 After completing steps 7-10 on pp. 453-454, the “Receipts” screen appears. Click on Save to post, then click on the “Close” icon.

26. ©The McGraw-Hill Companies, Inc., 2004 26 of 48 Entering a receipt, pp. 455 and 456 Read page 455. Then, complete steps 1 – 7 on pp. 455-456. Click on Save to post. Read the information under step 8 on p. 456.

27. ©The McGraw-Hill Companies, Inc., 2004 27 of 48 Partial payment, pp. 457-458 Complete steps 1 – 5 on p. 457. Click on Save to post (this is step 6 on p. 458).

28. ©The McGraw-Hill Companies, Inc., 2004 28 of 48 Enter cash sales, pp. 458-459 Read the information about cash sales on p. 458. Complete steps 1- 10 on pages 458 and 459 to enter cash sales.

29. ©The McGraw-Hill Companies, Inc., 2004 29 of 48 Receipts window for cash sale, p. 459 After completing steps 1-10 on pp. 458 and 459, the “Receipts” screen appears. Click on Save to post, then click on the “Close” icon.

30. ©The McGraw-Hill Companies, Inc., 2004 30 of 48 Printing customer forms, pp. 460-464 Read the information on pages 460 – 464. Complete steps 1 and 2 on page 463.

31. ©The McGraw-Hill Companies, Inc., 2004 31 of 48 Collection Manager window, p. 463-464 After completing step 2 on page 463, the “Collection Manager” window appears. Complete steps 3 – 8 on page 464.

32. ©The McGraw-Hill Companies, Inc., 2004 32 of 48 Printing the sales journal, pp. 464-465 Complete steps 1 – 4 on pp. 464-465. Compare your printout of the sales journal to the one shown on p. 465.

33. ©The McGraw-Hill Companies, Inc., 2004 33 of 48 Printing the cash receipts journal, p. 466 Complete steps 1 – 3 on p. 466. Compare your printout of the cash receipts journal to the one shown on p. 466.

34. ©The McGraw-Hill Companies, Inc., 2004 34 of 48 Printing the customer ledgers, p. 467 Complete steps 1 and 2 on page 467. Compare your printout of the customer ledgers to the one shown on p. 467.

35. ©The McGraw-Hill Companies, Inc., 2004 35 of 48 Printing the general ledger trial balance, p. 467-468 Complete steps 1 and 2 on page 467. Compare your printout of the general ledger trial balance to the one shown on p. 468.

36. ©The McGraw-Hill Companies, Inc., 2004 36 of 48 Editing receipts, pp. 468-469 Click on Tasks, Receipts, then select the “Abc Open” icon. Highlight “Invoice 104, Judy Piner.” Click on. The “Receipts” window appears with Judy Piner’s partial payment of $95.

37. ©The McGraw-Hill Companies, Inc., 2004 37 of 48 Backing Up Chapter 12 Data, pp. 469-470 Complete steps 1 - 9 on pages 469-470. 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.

38. ©The McGraw-Hill Companies, Inc., 2004 38 of 48 Glossary of Terms Chapter 12

39. ©The McGraw-Hill Companies, Inc., 2004 39 of 48 Accounts receivable, p. 430 Money that is owed by customers to the business.

40. ©The McGraw-Hill Companies, Inc., 2004 40 of 48 Accounts Receivable transactions, p. 430 Credit transactions from customers. When Jessica's Sales & Service sells merchandise on account to customers, the transactions are known as accounts receivable transactions.

41. ©The McGraw-Hill Companies, Inc., 2004 41 of 48 Invoice, p. 430 A bill that shows an itemized list of goods shipped or services rendered, stating quantities, prices, fees, and shipping charges.

42. ©The McGraw-Hill Companies, Inc., 2004 42 of 48 Cash Receipts Journal, p. 439 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.

43. ©The McGraw-Hill Companies, Inc., 2004 43 of 48 Sales journal, p. 439 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.

44. ©The McGraw-Hill Companies, Inc., 2004 44 of 48 Customer ledger, p. 439 The customer ledger shows account activity for each customer.

45. ©The McGraw-Hill Companies, Inc., 2004 45 of 48 Accounts receivable ledger, p. 439 The accounts receivable ledger shows the account activity for each customer. In Peachtree, this is called the customer ledger.

46. ©The McGraw-Hill Companies, Inc., 2004 46 of 48 Service invoice, p. 448 An alternative to the standard invoice. Use it when you want to create an invoice without inventory items. Jessica's Sales & Service sells and repairs household items. When repairs are done, a service invoice is used.

47. ©The McGraw-Hill Companies, Inc., 2004 47 of 48 1 Go to the book’s website at www.mhhe.com/yacht2003 www.mhhe.com/yacht2003 2 In the “Student Center” list, link to Internet Activities. 3 Link to WEB EXERCISES PART 3. 4 Complete the “THE ACCOUNTANT’S WEB MAGAZINE AND RESOURCE GUIDE: FAULKNER & GRAY’S 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. 470

48. ©The McGraw-Hill Companies, Inc., 2004 48 of 48 Going to the Net, p. 471 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?