ACCTG 11-1

Fundamentals of Accounting

GBS FOR WEEK NO. 14 & 15

Period Covered: ____________________________

SCHOOL YEAR _________________ | ________ Semester

OBJECTIVES:
After working in this material, the learner is expected to:

Know the different kinds, uses and formats of special journals.

Record all the business transactions in the appropriate special journals.

CORE LESSON CONTENTS:

SPECIAL JOURNALS AND SUBSIDIARY LEDGERS
SPECIAL JOURNALS or COMBINATION JOURNALS
A large number of transactions of frequent occurrence (repetitive) and of the same
nature are recorded in their respective special or combination journals, alternatively
called special journals. The use of said journals provides advantages like, division of
labor is facilitated as one journal may be assigned to an employee and savings are
realized in terms of time and cost otherwise spent with the use of general journals.
Business transactions generally fall into 4 categories:
Category of transactions
Special Journal
1. All sales on open accounts (receivables)
Sales Journal (SJ)
2. All purchases on account (payables)
Purchase Journal (PJ)
3. Receipts of cash from all sources
Cash Receipt Journal (CRJ)
4. Payments of cash for all purposes
Cash Payments Journal (CPJ)
The frequency of occurrence of similar transactions will determine the special needed.
Example is, businesses that sell for cash basis only would not require a sales journal. All
other transactions aside from the four above will be recorded in the general journal (GJ).
Combination journals are books of original entry.

SUBSIDIARY LEDGERS (SL)

The general ledgers (GL) for the accounts receivable (A/R) and accounts payable (A/P)
hold the accounts reported in the financial statements. To identify whose accounts
(name of creditor or name of debtor) these are necessitates the use of SL. The subsidiary
ledger is a book of accounts that provides supporting details on individual balances,
whether debtors for A/R or creditors for A/P, the total of which appears in general
ledger account. The entries in the SL must be made whenever a transaction affects either
the GL for A/R or A/P accounts.
SALES JOURNAL
The SJ, also known as Credit Sales Journal, is used to record sales of merchandise on
account or on credit.
Example of an SJ
The entry to record a credit sales is: Dr. Accounts Receivable 40,000
Cr. Sales
40,000
To record credit sales to Abby.
Dr. Accounts Receivable 50,000
Cr. Sales
50,000
To record credit sales to Beabi.

Date
1/1
1/8
1/15
1/25
1/31

SALES JOURNAL
Invoice No. Account Debited
1001
Amily
1098
Bourbon
1201
Carbon
1525
Daelta
1698
Echo
total

P/R
3
3
3
3
3

Page 1
A/R DR. Sales CR
45,000 (see posting)
50,000
90,000
8,000
150,000
343,000
(103-Dr) (401-Cr)

The total of P343,000 will be posted in the General Ledger:

103-Account Receivable number in the Chart of Accounts-Dr. P343,000
401-Sales account number in the Chart of Accounts-Cr. P343,000
The contents of the SJ will be posted in the individual AR/SL (see below).
Accounts Receivable Subsidiary Ledger contains the name of customer, address, date,
particulars, posting reference, debit (sales on account), credits (payments and returns)
and balance (total of debits minus total credits).
The total of all A/R SL shall be totaled in a Schedule of Accounts Receivable at the end
of each accounting period.
Accounts Receivable Subsidiary Ledger AR/SL

Client: Amily
Date
Particulars
1/5
Sales on account
1/31
Payment

P/R

Address: SM North, Stall 35

Debit
Credit Balance
SJ1
45,000
45,000
SJ1
14,750
30,250

At the end of the month (one accounting period) all clients balances in the A/R SL shall
be totaled to arrive at the periods total outstanding A/R that should be posted in the
A/R GL.
Schedule of A/R
Jan. 31, 2012
Amily
Bourbon
Carbon
Daelta
Echo
Total

P 30,250
20,160
16,150
90,000
45,690
P202,250

PURCHASE JOURNAL (PJ)

The PJ is used to record all purchases on account. Among others, this is designed to
record all purchases of inventory, supplies, and other assets. Specifically, the PJ would
ease the journalization and posting of processes when purchases on account are
numerous.
Example of a PJ.
The entry to record credit purchases or purchases on account is:
Dr. Purchases
500,500
Cr. Accounts Payable
500,500
To record purchase of merchandise on credit from Dee Ent.
Dr. Supplies
150,000
Cr. Accounts Payable
150,000
To record purchase of supplies on account from Decal Republic.
Dr. Furniture and Fixtures
400,000
Cr. Accounts Payable
400,000
To record credit purchase of assets from Derek.
PURCHASES JOURNAL
Date
Account Credited
Account Debited
1/5
Dee Enterprises
1/15
Decal Republic
1/25
Derek
Furniture/Fixture
1/26
Delta Air

P/R
5
5

A/P Cr.

PAGE 1
Purchases Dr. Supplies Dr.

500,500 500,500
150,000
5
400,000
1,200,000 1,200,000

Sundry

150,000
400,000

1/31

Doha Q
Total

2,200,000 2,200,000______________________
4,315,000 3,900,500
150,000
400,000

The above transactions under Purchases will be posted to the individual AP/SL, while
supplies and furniture will be directly transferred to the GL, Account number of
Supplies is 105, and Furniture is 109. After recording purchases in the AP/SL, the total
in the SL shall be transferred and posted to the GL accounts as follows:
Account Number in the Chart of Accounts: A/P 201, Purchases is 501
The same should be done to Accounts Payable. Accounts Payable Subsidiary Ledger
contains the name of creditor, address, date, particulars, posting reference, credit
(purchases on account), debits (payments and returns) and balance (total of credits
minus total debits).
The total of all A/P SL shall be totaled in a Schedule of Accounts Payable at the end of
each accounting period.
Accounts Payable Subsidiary Ledger AP/SL
Client: Dee Ent.
Date
Particulars
P/R
Debit
1/5
Purchases on account
PJ1
1/31
Payment
PJ1

Address: Divisoria, Stall 145

Credit Balance
500,500 500,500
250,000
250,500

At the end of the month (one accounting period) all creditors balances in the A/P SL
shall be totaled to arrive at the periods total outstanding A/P that should be posted in
the A/P GL.
Schedule of A/P
Jan. 31, 2012
Dee Ent.
Decal Republic
Derek
Delta Air
Doha Q
Total

P 250,500
120,805
320,001
890,200
2,112,111
P3,693,617

CASH RECEIPT JOURNAL OR CRJ

The CRJ is used to record all receipts of cash from all sources. A good internal control for
accounting of cash is, all collections, whether in cash or in checks, shall be deposited
intact daily to the depository bank. Typical cash transactions are shown below:

Dr. Cash
500,000
Cr. Sales
500,000
To record cash Sales
Dr. Cash
40,000
Cr. Accounts Receivable 40,000
To record collection of receivables.

Dr. Cash
700,000
Cr. Bank Loan Payable 700,000
To record proceeds of bank loan.
Dr. Cash
1,000,000
Cr. Ventura, Capital
1,000,000
To record initial investment.
Dr. Cash
2,500,000
Cr. Sales
2,500,000
To record cash sales.

CASH RECEIPT JOURNAL

Date Account Credited
P/R
1/1 Ventura, Capital
301
1/3 Collection Mae
/
1/5 Bank Loan Payable /
1/18 Sales
/
Total

Sundry Cr.
1,000,000

PAGE 1
Sales Cr

A/R Cr.

Sales Disc. Cr.

40,000
700,000
2,500,000
1,700,000 2,500,000
/
(401)

40,000
(103)

Cash Dr.
1,000,000
40,000
700,000
2,500,000
4,240,000
(101)

The one with the check mark (Ventura Capital and bank loan under Sundry) will not be
posted because it is already posted in the ledger at the time of the transaction. Those
with Account Numbers will be posted in the corresponding SL accounts.
CASH PAYMENT JOURNAL OR CPJ
The CPJ also known as cash disbursement journal or CDJ, is used to record all payments
of cash transactions.
As a good internal control for cash, all payments must be
disbursement vouchers and a check shall be drawn to pay for such expenses, except of
course for petty expenses, wherein a petty cash fund may be established to pay for small
emergency expenses like refreshment of visitors, sugar, coffee, photocopying services,
key duplication, notarial fee, transportation expenses of messenger, and similar
expenses wherein check preparation is too tedious.

CASH PAYMENT JOURNAL

Date
1/1
1/5
1/6
1/8
1/9
1/10
1/15

Chk.No.
2011
2012
2013
2014
2015
2016
2017

Account Debited
Prepaid Rent
Store Supplies
Purchases
Salaries Expense
Gents House
Leather House
Vinas Boutique
Total

P/R
104
106
501
504
/
/
/

PAGE 1
Sundry Dr.
200,000
20,000
500,000
80,000

800,000
/

A/P Dr.

Purch. Disc. Cr.

60,000
40,000
50,000
150,000
(201)

800
5,000
5,800
(502)

Cash Cr.
200,000
20,000
500,000
80,000
60,000
39,200
45,000
944,200
(101)

The one with the check mark (all under sundry accounts) will not be posted because
it is already posted in the ledger at the time of the transaction. Those with Account
Numbers will be posted in the corresponding SL accounts.

TOPIC INDEXES AND KEYWORDS (TIK):

______________________
_______________________

TANGENT ADDITIONAL KEYWORDS (TAK):

______________________________

EVALUATION (OUTCOME):
1. Journalize the following sales transactions and post to the Sales Journal and
individual accounts receivable subsidiary ledger. Summarize the Account
Receivable Subsidiary Ledger on June 15.
June 2
Sold Merchandise to Lewis on account for P150,000, invoice no. 201.
8 Sold Merchandise to Leggins on account for P300,000, invoice no. 202.
14 Sold Merchandise to Lewins on account for P450,000, invoice no. 203.
2. Journalize the following disbursement transactions and post to the Purchase
Journal and individual accounts payable subsidiary ledger. Summarize the
Account Payable Subsidiary Ledger on June 15.
June 1
Purchased merchandise on account from Gents for P350,000 eom.
4 Purchased supplies on account from NBS for P4,000.
5 Purchased computer on account from Yutivo for P45,000.
6 Purchased merchandise on account from Vina for P400,000.
10 Purchased merchandise on account from Xena for P350,000.

PRIMARY REFERENCE MATERIAL(S):

Special journals and methods of processing accounting data

http://higheredbcs.wiley.com/legacy/college/kieso/0470374942/gate/E
xpanded_Discussions/Ch03_Expanded_Discussion_Special_Journals/sp
ecial_journals.html

SECONDARY REFERENCE MATERIAL(S):

THE World Wide Web

SUBMISSION Instruction:
Deadline
e-mail

:
:

Filename
NAME.doc
Subject (Re)

Sunday of Week 14 (Extension: Sunday of Week 15).

acctg11-1@vem.edu.ph
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ACCTG 11-1 - WEEK 14 & 15 Activity and Output - YOUR

ACCTG 11-1 - WEEK 14 & 15 Activity and Output

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