Special Journals: Sales and Cash Receipts

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Chapter 16

Special Journals Sales and Cash Receipts

Making Accounting Relevant In a merchandising
business, revenue from sales fuels business
operations.


What tactics do businesses in your area use to
increase sales?
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Chapter 16
Section 1 The Sales Journal

• What Youll Learn
• To identify the special journals and how they are
  used.
• How to record sales of merchandise on account in
  a sales journal.
• How to post from the sales journal to the
  accounts receivable subsidiary ledger accounts.
• How to foot, prove, total, and rule the sales
  journal.
• How to post column totals from the sales journal
  to the general ledger.

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Section 1 The Sales Journal (cont.)
Chapter 16

Why Its Important The use of the sales journal
provides a systematic method of keeping track of
sales on account.

• Key Terms
• special journals
• sales journal
• footing

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Section 1 The Sales Journal (cont.)
Chapter 16

Special Journals Special journals have amount
columns used to record debits and credits to
specific general ledger accounts.

Journal Transaction

Sales Journal sales of merchandise on account
Cash Receipts Journal receipt of cash

Purchases Journal purchase of any asset on account
Cash Payments Journal payment of cash, including
payments by check
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Section 1 The Sales Journal (cont.)
Chapter 16

The Sales Journal The sales journal is a special
journal used to record sales of merchandise on
account.

• Record the amount of the
• merchandise sold on account

• Record the amount of sales tax on
• the sale

• Record the total amount to be received from the
  customer on account

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Section 1 The Sales Journal (cont.)
Chapter 16

Recording Sales of Merchandise on Account
Business Transaction

On December 1 On Your Mark sold merchandise on
account to Casey Klein for 200 plus 12 sales
tax, Sales Slip 50.

JOURNAL ENTRY

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Section 1 The Sales Journal (cont.)
Chapter 16

Posting a Sales Journal Entry to the Accounts
Receivable Subsidiary Ledger To keep the
balances of the customer accounts current, sales
journal transactions are posted daily to the
accounts receivable subsidiary ledger.



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Section 1 The Sales Journal (cont.)
Chapter 16

Footing, Totaling, Proving, and Ruling the Sales
Journal



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Section 1 The Sales Journal (cont.)
Chapter 16

Posting the Total of the Sales Credit
Column Next, transfer the amount in the Sales
column to the general ledger.



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Section 1 The Sales Journal (cont.)
Chapter 16

Posting the Total of the Sales Tax Payable Credit
Column Next, transfer the amount in the Sales
Tax Payable column to the general ledger.



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Section 1 The Sales Journal (cont.)
Chapter 16

Posting the Total of the Accounts Receivable
Debit Column The last amount to be transferred
to the general ledger is the Accounts Receivable
Debit column.



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Section 1 The Sales Journal (cont.)
Chapter 16

Proving the Sales Journal at the End of a
Page If a business has many transactions in one
month, and it is impossible to fit them onto one
journal page, the journal page must be totaled
and rules before a new page is started.



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Section 1 The Sales Journal (cont.)
Chapter 16

Check Your Understanding
1. What columns does the sales journal contain?


2. What does an account number written in
parenthesis under a column total mean?