![]() ![]() Notice the dates and posting references applied to each entry in the illustration to the right. Each entry increases (debits) accounts receivable and increases (credits) sales. In its most basic form, a sales journal has only one column for recording transaction amounts. ![]() Invoices are the source documents that provide this information. Entries in the sales journal typically include the date, invoice number, customer name, and amount. Sales returns and cash sales are not recorded in this journal. The sales journal lists all credit sales made to customers. Then, instead of separately posting individual entries, each column's total is posted at the end of the accounting period.Īlthough companies create special journals for other types of repetitive transactions, almost all merchandising companies use special journals for sales, purchases, cash receipts, and cash disbursements. ![]() Such transactions can be documented on one line in a special journal. To speed up this process, companies use special journals to record repetitive transactions that affect the same set of accounts and have a consistent description. If the transaction affects a control account, the posting must be done twice-once to the subsidiary ledger account and once to the controlling general ledger account. The transaction must then be posted to each general ledger account. In the general journal, a simple transaction requires three lines-two to list the accounts and one to describe the transaction. Inventory Errors and Financial StatementsĮntering transactions in the general journal and posting them to the correct general ledger accounts is time consuming.Inventory Systems: Perpetual or Periodic.Recording Notes Receivable Transactions.Subsidiary Ledgers and Special Journals.The Work Sheet When Closing Entries Update Inventory.Closing Entries for a Merchandising Company.Inventory Adjustments on the Work Sheet.Financial Statements for a Merchandising Company.The Cost of Goods Available for Sale and the Cost of Goods Sold.Net Purchases and the Cost of Goods Purchased.Generally Accepted Accounting Principles. ![]()
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