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Chapter 6 - Journalizing
Book of original entry.
Transactions recorded in chronological order.
Purpose of the Journal:
1. Shows the complete effects of a transaction.
2. Provides a chronological record of transactions.
3. Helps to prevent or locate errors because the debit and credit amounts can be easily compared.
The JournalThe Journal
SO 4 Explain what a journal is and how it helps in the recording SO 4 Explain what a journal is and how it helps in the recording process.process.
Chapter 6.1
16
• Enter the date
Recording Journal Entries
Chapter 6.1
16Date
99Nov.Nov.20—20—
Chapter 6.1
16Step 2
99Nov.Nov.20—20—
• Enter the debit account(s)
Chapter 6.1
16
99Nov.Nov.20—20—
Supplies
Chapter 6.1
16
99Nov.Nov.20—20—
Supplies
• Enter the debit amount(s)
Step 3
Chapter 6.1
16
99Nov.Nov.20—20—
Supplies 1 3 5 –
Enter Debit Amounts
Chapter 6.1
16
99Nov.Nov.20—20—
Supplies 1 3 5 –
• Indent and enter the credit account(s)
Step 4
Chapter 6.1
16
99Nov.Nov.20—20—
Supplies 1 3 5 –
Bank
Enter Credit Accounts
Chapter 6.1
16
99Nov.Nov.20—20—
Supplies 1 3 5 –
Bank
• Enter the credit amount(s)
Step 5
Chapter 6.1
16
99Nov.Nov.20—20—
Supplies 1 3 5 –
Bank 1 3 5 –
Enter Credit Amounts
Chapter 6.1
16
99Nov.Nov.20—20—
Supplies 1 3 5 –
Bank 1 3 5 –
• Write a brief explanation (at left margin)
Step 6
Chapter 6.1
16
99Nov.Nov.20—20—
Supplies 1 3 5 –
Bank 1 3 5 –
Letterhead and envelopes; cheque #40
Write Explanation
Chapter 6.1
16
99Nov.Nov.20—20—
Supplies 1 3 5 –
Bank 1 3 5 –
Letterhead and envelopes; cheque #40
• Skip a line and complete next entry
Skip a line
Chapter 6.1
16
1 3 5 –
99Nov.Nov.20—20—
Supplies 1 3 5 –
Bank
Letterhead and envelopes; cheque #40
12
Record the Next Entry
Chapter 6.1
16
99Nov.Nov.20—20—
Supplies 1 3 5 –
Bank 1 3 5 –
Letterhead and envelopes; cheque #40
12 Equipment
Record the Next Entry
Chapter 6.1
16
99Nov.Nov.20—20—
Supplies 1 3 5 –
Bank 1 3 5 –
Letterhead and envelopes; cheque #40
12 Equipment 12 0 0 0 –
Record the Next Entry
Chapter 6.1
16
99Nov.Nov.20—20—
Supplies 1 3 5 –
Bank 1 3 5 –
Letterhead and envelopes; cheque #40
12 Equipment 12 0 0 0 –
A/P—World Wide Fibre Optics
Record the Next Entry
Chapter 6.1
16
99Nov.Nov.20—20—
Supplies 1 3 5 –
Bank 1 3 5 –
Letterhead and envelopes; cheque #40
12 Equipment 12 0 0 0 –
A/P—World Wide Fibre Optics 10 0 0 0 –
Record the Next Entry
Chapter 6.1
16
99Nov.Nov.20—20—
Supplies 1 3 5 –
Bank 1 3 5 –
Letterhead and envelopes; cheque #40
12 Equipment 12 0 0 0 –
A/P—World Wide Fibre Optics 10 0 0 0 –
Bank
Record the Next Entry
Chapter 6.1
16
99Nov.Nov.20—20—
Supplies 1 3 5 –
Bank 1 3 5 –
Letterhead and envelopes; cheque #40
12 Equipment 12 0 0 0 –
A/P—World Wide Fibre Optics 10 0 0 0 –
Bank 2 0 0 0 –
Record the Next Entry
Chapter 6.1
16
99Nov.Nov.20—20—
Supplies 1 3 5 –
Bank 1 3 5 –
Letterhead and envelopes; cheque #40
12 Equipment 12 0 0 0 –
A/P—World Wide Fibre Optics 10 0 0 0 –
Bank 2 0 0 0 –
Network software installation; issued cheque
#41 with the balance due in 30 days.
Record the Next Entry
Chapter 6.1
16
Supplies 1 3 5 –
Bank
Letterhead and envelopes; cheque #40
12 Equipment
A/P—World Wide Fibre Optics
Network software installation; issued cheque
#41 with the balance due in 30 days.
12 0 0 0 –
Bank
10 0 0 0 –
2 0 0 0 –
1 3 5 –
99Nov.Nov.20—20—
• Consecutive page numbers
Page Numbers
Chapter 6.1
16
Supplies 1 3 5 –
Bank
Letterhead and envelopes; cheque #40
12 Equipment
A/P—World Wide Fibre Optics
Network software installation; issued cheque
#41 with the balance due in 30 days.
12 0 0 0 –
Bank
10 0 0 0 –
2 0 0 0 –
1 3 5 –
99Nov.Nov.20—20—
• Each journal entry balances
Balanced Entries
Chapter 6.1
16
Supplies 1 3 5 –
Bank
Letterhead and envelopes; cheque #40
12 Equipment
A/P—World Wide Fibre Optics
Network software installation; issued cheque
#41 with the balance due in 30 days.
12 0 0 0 –
Bank
10 0 0 0 –
2 0 0 0 –
1 3 5 –
99Nov.Nov.20—20—
• A “compound entry” affects more than two accounts
Compound Entries
Chapter 6.1
16
Supplies 1 3 5 –
Bank
Letterhead and envelopes; cheque #40
12 Equipment
A/P—World Wide Fibre Optics
Network software installation; issued cheque
#41 with the balance due in 30 days.
12 0 0 0 –
Bank
10 0 0 0 –
2 0 0 0 –
1 3 5 –
99Nov.Nov.20—20—
• Account titles are capitalized
Account Titles
Chapter 6.1
16
• Amounts in the opening journal entry are the same as amounts on the opening balance sheet
Bank
Supplies
Equipment
Bank Loan
Opening financial position of Shirley Cassar
19 5 5 0 –
Shirley Cassar, Capital
10 0 0 0 –
1 4 0 0 –3030Oct.Oct.20—20—
Automobile
22 0 9 0 –
8 7 1 5 –
2 4 2 5 –
The Opening Entry