lecture 19 chapter 5 accounting systems. review of lecture format of ledger with running balance...
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Lecture 19
Chapter 5
Accounting Systems
Review of Lecture
• Format of Ledger with running balance• Special Journal• Subsidiary Ledger• Revenue Journal
SPECIAL JOURNAL
Special Journal contains records of original entry other than the general journal that are designed for recording specific types of transactions of similar nature, e.g. Sales Journal, Purchase Journal, Cash Receipts Journal, Cash Disbursements Journal
Subsidiary Ledger
A subsidiary ledger is a group of similar accounts whose combined balances equal the balance in a specific general ledger account. The general ledger account that summarizes a subsidiary ledger's account balances is called a control account or master account.
Subsidiary ledger accounts are not part of the general ledger; they are supplemental accounts that provide the detail to support the balance in a control account.
The Cash Receipts JournalThe Cash Receipts Journal
All transactions that involve the receipt of cash are
recorded in the cash receipts journal.
All transactions that involve the receipt of cash are
recorded in the cash receipts journal.
The Cash Receipts Journal
Mar. 1 Rent Revenue 400 400
CASH RECEIPTS JOURNALOther Accounts
Post Accounts Receivable CashDate Account Credited Ref. Cr. Cr. Dr.
Page 14
Opportunities Inc. received Rs.400 cash on March 1 for the month’s rent.
The Cash Receipts Journal
2010
Mar. 1 Rent Revenue 400 400
CASH RECEIPTS JOURNALOther Accounts
Post Accounts Receivable CashDate Account Credited Ref. Cr. Cr. Dr.
During March, Opportunities Inc. collected cash from three customers.
19 Web Cantina 3,400 3,400 28 MyMusicClub.com 2,200 2,200 30 Zone.com 1,750 1,750
The Cash Receipts Journal
Page 14
2010
Each account under “Accounts Receivable Cr.” is posted to the
accounts receivable subsidiary ledger.
Posting the Cash Receipts Journal
Mar. 1 Rent Revenue 400 400
CASH RECEIPTS JOURNALOther Accounts
Post Accounts Receivable CashDate Account Credited Ref. Cr. Cr. Dr.
19 Web Cantina 3,400 3,400 28 MyMusicClub.com 2,200 2,200 30 Zone.com 1,750 1,750
Page 14
2010
Mar. 1 Rent Revenue 400 400
CASH RECEIPTS JOURNALOther Accounts
Post Accounts Receivable CashDate Account Credited Ref. Cr. Cr. Dr.
Page 14
19 Web Cantina 3,400 3,400 28 MyMusicClub.com 2,200 2,200 30 Zone.com 1,750 1,750
Accounts Receivable Subsidiary Ledger
Date Item P.R. Debit Credit Balance
Web Cantina
Mar. 1 Bal. 3,40018 R35 2,650 6,050
2010
3,400 2,650
Posting the Cash Receipts Journal
2010
19
Mar. 1 Rent Revenue 400 400
CASH RECEIPTS JOURNALOther Accounts
Post Accounts Receivable CashDate Account Credited Ref. Cr. Cr. Dr.
Page 14
19 Web Cantina 3,400 3,400 28 MyMusicClub.com 2,200 2,200 30 Zone.com 1,750 1,750
Posting the Cash Receipts Journal
Accounts Receivable Subsidiary Ledger
Date Item P.R. Debit Credit Balance
Web Cantina
Mar. 1 Bal. 3,40018 R35 2,650 6,050
2010
3,40019 CR14 2,650
2010
The Cash Receipts Journal
After all journalizing and posting to the accounts
receivable subsidiary ledger for the month is complete, the
columns are totaled.
After all journalizing and posting to the accounts
receivable subsidiary ledger for the month is complete, the
columns are totaled.
The Cash Receipts Journal
Mar. 1 Rent Revenue 400 400 19 Web Cantina 3,400 3,400 28 MyMusicClub.com 2,200 2,200 30 Zone.com 1,750 1,750 31 400 7,350 7,750
CASH RECEIPTS JOURNALOther Accounts
Post Accounts Receivable CashDate Account Credited Ref. Cr. Cr. Dr.
Page 14
2010
The total “Cash Dr.” column equals the total of
the two credit columns.
ACCOUNT Accounts Receivable Account No. 12
Balance
Dr. Cr.Date Dr. Cr.Item
Post. Ref.
2010Mar. 1 Balance 3 400
GENERAL LEDGER
31 9 600 13 000 R35
Revenue Journal, page 35
Posting the Revenue Journal Total
Mar. 1 Rent Revenue 400 400 19 Web Cantina 3,400 3,400 28 MyMusicClub.com 2,200 2,200 30 Zone.com 1,750 1,750 31 400 7,350 7,750
CASH RECEIPTS JOURNALOther Accounts
Post Accounts Receivable CashDate Account Credited Ref. Cr. Cr. Dr.
Page 14
Posting the Cash Receipts Journal
2010
Account: Accounts Receivable No. 12
GENERAL LEDGER
Date Item P.R. Debit Credit Balance
Mar. 1 Bal 3,40031 R35 9,600 13,000
2010
Mar. 1 Rent Revenue 400 400 19 Web Cantina 3,400 3,400 28 MyMusicClub.com 2,200 2,200 30 Zone.com 1,750 1,750 31 400 7,350 7,750
CASH RECEIPTS JOURNALOther Accounts
Post Accounts Receivable CashDate Account Credited Ref. Cr. Cr. Dr.
Page 14
Posting the Cash Receipts Journal
2010
Account: Accounts Receivable No. 12
GENERAL LEDGER
Date Item P.R. Debit Credit Balance
Mar. 1 Bal 3,40031 R35 9,600 13,000
2010
7,350 5,65031 CR14
Mar. 1 Rent Revenue 400 400 19 Web Cantina 3,400 3,400 28 MyMusicClub.com 2,200 2,200 30 Zone.com 1,750 1,750 31 400 7,350 7,750
CASH RECEIPTS JOURNALOther Accounts
Post Accounts Receivable CashDate Account Credited Ref. Cr. Cr. Dr.
Page 14
Posting the Cash Receipts Journal
2010
( ) (12)
Posting the Cash Receipts Journal
Rs.7,750 total in the Cash Debit column is posted to Cash in a similar manner.
Rs.7,750 total in the Cash Debit column is posted to Cash in a similar manner.
Posting the Cash Receipts Journal
Rs.400 credit to Rent Revenue could have been posted earlier, but posting it at the same time as other general
ledger accounts is proper.
Rs.400 credit to Rent Revenue could have been posted earlier, but posting it at the same time as other general
ledger accounts is proper.
Mar. 1 Rent Revenue 400 400 19 Web Cantina 3,400 3,400 28 MyMusicClub.com 2,200 2,200 30 Zone.com 1,750 1,750 31 400 7,350 7,750
CASH RECEIPTS JOURNALOther Accounts
Post Accounts Receivable CashDate Account Credited Ref. Cr. Cr. Dr.
Page 14
Posted Cash Receipts Journal
42
( ) (12) (11)
2010
Accounts Receivable
Control Account
If the accounts receivable account in the general ledger only shows summary totals,
where are the individual customer balances?
ACCOUNT Accounts Receivable No. 12
GENERAL LEDGER
Date Item P.R. Debit Credit BalanceMar. 1 Bal 3,400
31 R35 9,600 13,0007,350 5,65031 CR14
Date Item P.R. Debit Credit Balance
RapZone.com
3/6 R35 1,750 1,7503/30 CR14 1,750 --
Date Item P.R. Debit Credit Balance
Web CantinaDate Item P.R. Debit Credit Balance
3/2 R35 2,200 2,2003/27 R35 3,000 5,2003/28 CR14 2,200 3,000
3/1 Bal. 3,4003/18 R35 2,650 6,0503/19 CR14 3,400 2,650
Accounts Receivable Subsidiary
Ledger
Accounts Receivable
Control Account
MyMusicClub.com
ACCOUNT Accounts Receivable No. 12
GENERAL LEDGER
Date Item P.R. Debit Credit BalanceMar. 1 Bal 3,400
31 R35 9,600 13,0007,350 5,65031 CR14
End of Lecture 19