I will be responsible for knowing and understanding the following
concepts:
Accounting Terms Related to the sales and cash receipts journals
Accounting Concepts and Practices related to the sales and cash receipts
journals
Journalize Sales on Account using a sales journal
Journalize Cash Receipts using a cash receipts journal
Recording Sales Returns and Allowances using a general journal
I will be able to listen to my instructor and take notes, be an active
participant as needed.
I will complete the Workbook Assignments for 10-1
Expanding the Ledger-Special Journals
Used to record similar types of transactions.
If a transaction cannot be recorded in a special journal, the
company records it in the general journal.
LESSON 9-1
2
 What
are some things that you
buy when you go out shopping?
 What
different factors affect the
final price that YOU pay at the
register?
NEW TERMS
Customer: a person or business to whom
merchandise or services are sold
Sales tax: a tax on a sale, usually a
percentage of sales
-Every business collecting a sales tax needs
accurate records of the amount of total sales
and total sales tax collected.
-The amount of sales tax collected is a business
liability until paid to the government agency.
Sales Tax Payable – liability account where
sales tax amounts are recorded.
-A customer must pay the price of the goods
PLUS the sales tax amount.
A Sale of merchandise is either on account (charge
sale) or for cash.
Concept: Realization of Revenue - Sales increase
the revenue of a business and should be recorded at
the time of sale.
Accounts Receivable – a general ledger asset
account used to summarize the total due from all
charge customers.
Sales Journal – used to record only sales of
merchandise ON ACCOUNT
Sales Invoice – source document for recording
a sale on account
November 3. Sold merchandise on account to Village Crafts, $540.00,
plus sales tax, $32.40; total, $572.40. Sales Invoice No. 76.
1
2
3
4
1. Write the date.
2. Write the customer name.
3. Write the sales invoice number.
4. Write the total amount owed by the customer.
5. Write the sales amount.
6. Write the sales tax amount.
5
6
page 275



customer
sales tax
sales journal
LESSON 10-1
11
WT
OYO
TB
275
275
WB
225
226
LESSON 10-1
12

I will be responsible for knowing and understanding the
following concepts:
Accounting terms related to cash receipts for a merchandising
business
Accounting concepts as they relate to a cash receipts for a
merchandising business
Accounting practices as they relate to the Cash Receipts Journal


I will be able to listen to my instructor and take notes,
be an active participant as needed.
I will complete 10-2 Workbook activities as assigned



What are the different ways you pay for
products when you go to the store?
What happens when you swipe your credit
card?
Do you know of any stores that do not accept
credit cards? Why?
Expanding the Ledger-Special Journals
Used to record similar types of transactions.
If a transaction cannot be recorded in a special journal, the
company records it in the general journal.
LESSON 9-1
15
Cash Sale – a sale in which cash is received for the
total amount at the time of the transaction
Credit card sale – a sale in which a credit card is
used for the total amount of the sale at the time
of the transaction ex. Visa, MasterCard, American
Express
- A customer who uses a credit card promises to
pay the amount due for the transaction to the
bank issuing the card
- Merchandising businesses contract with a bank
to process credit card sales and pay a percentage
of those sales as a fee for credit card processing
A computer used to
collect, store and report
all the information of a
sales transaction. Uses a
scanning device to scan
the Universal Product
Code (UPC) symbol on
the item. The POS stores
the number, description,
price and quantity on
hand of each item of
merchandise.
UPC (Universal
Product Code)
Cash Register Receipt –
does NOT show
information about what
merchandise was sold
Point-of-Sale (POS)
Terminal Receipt –
shows information
(continued on next slide)
Terminal
Summary – a
report that
summarizes cash
and credit card
sales, used as a
source document
for recording
sales
Batch Report –
contains a
summary of
ONLY credit card
sales
Batching out –
the process of
preparing a batch
report of credit
card sales
Cash Receipts Journal – a special journal used to
record only cash receipt transactions
Sales Discount – a cash discount on sales taken
by a customer, pays less than the invoice amount
previously recorded.
November 4. Recorded cash and credit card sales, $5,460.00, plus
sales tax, $327.60; total, $5,787.60. Terminal Summary 34.
2
1
1.
2.
3.
4.
5.
6.
7.
4
3
5
Write the date.
Place a check mark in the Account Title column.
Write the terminal summary document number.
Place a check mark in the Post. Ref. column.
Write the sales amount.
Write the sales tax amount.
Write the cash amount.
6
7
November 6. Received cash on account from Country Crafters,
$2,162.40, covering S69. Receipt No. 90.
1
1.
2.
3.
4.
5.
2
3
Write the date.
Write the customer’s name.
Write the receipt number.
Write the credit amount.
Write the debit amount.
4
5
November 7. Received cash on account from Cumberland Center,
$1,176.00, covering Sales Invoice No. 74 for $1,200.00, less 2%
discount, $24.00. Receipt No. 91.
1
2
3
1. Write the date.
2. Write the customer’s name.
3. Write the receipt number.
4
5
6
4. Write the original invoice amount.
5. Write the amount of sales discount.
6. Write the debit to cash.
•Cash on hand at the beginning of the month
$17,647.44
•(Nov 1 balance of general ledger cash account)
•Plus total cash received during the month
$38,668.80
•(Cash debit column total, cash receipts journal)
•Equals total
$56,316.24
•Less total cash paid during the month
$32,
901.40
•(Cash credit column total, cash payments journal, Chapter 9)
•Equals cash balance on hand at the end of the month
$23,414.84
•Checkbook balance on the next unused check stub$23,414.84
page 284








cash sale
credit card sale
point-of-sale (POS) terminal
terminal summary
batch report
batching out
cash receipts journal
sales discount
Text Book
Work Book
WT
284
227
OYO
284
228
LESSON 10-2
27

I will be responsible for knowing and understanding the
following concepts:
Accounting terms related to the sales and cash receipts journals
for a merchandising business
Accounting practices as they relate to the sales and cash receipts
journals
Record sales returns and allowances using a general journal


I will be able to listen to my instructor and take notes,
be an active participant as needed.
I will complete 10-3 Workbook activities as assigned
What can a customer do if they are
dissatisfied with their purchase or if it
damaged?
 What amount of money do we give
back to them?
 What 2 types of transactions did we
put in the general journal in the last
chapter?





Sales Return – credit allowed a customer for the sales
price of returned merchandise (plus tax) resulting in
a decrease in A/R, AS WELL AS a decrease in sales
tax.
Sales Allowance – credit allowed a customer for PART
of the sales price of merchandise (plus tax) that is
NOT returned, resulting in a decrease in A/R AS WELL
AS a decrease in sales tax.
Credit Memorandum – a form prepared by the
vendor showing the amount deducted for returns
and allowances (source document)
Sales Returns and Allowances is a contra account to
Sales, has a normal debit balance.
Sales tax is listed
separately and must
be recorded as such
in the transaction
March 11. Granted credit to Village Crafts for merchandise returned, $58.50,
plus sales tax, $3.51, from S160; total, $62.01. Credit Memorandum No. 41.
Sales tax is
debited here
because it
was given
back to the
customer
2
4
1
5
3
7
1. Write the date.
2. Write Sales Returns and Allowances.
3. Write CM and the credit memorandum
number.
4. Write the amount of the sales return.
5. Write Sales Tax Payable.
8
6
9
6. Write the sales tax amount.
7. Write the accounts to be credited.
8. Draw a diagonal line in the Post.
Ref. column.
9. Write the total accounts receivable
amount.


Work Together 10-3: Text Page 287,
Workbook Page 229
On Your Own 10-3: Text Page 287,
Workbook Page 230


APPLICATION PROBLEM 10-2: Text Page
289-290, Workbook Page 232
APPLICATION PROBLEM 10-3: text Page 290,
Workbook Page 233
LESSON 10-3
34