Accounting 11 6.

1The Journal The Two-Column General Journal ~accounting entries for the transactions are referred to as journal entries. ~a journal entry is made up of all the accounting changes for one transaction, i n the form in which they are written up in the general journal. ~debit first. ~at least one debit amount and one credit amount; must balance. ~journalizing is the process of recording accounting entries in the journal(<--a ka book of orginial entry) ~transactions occur--> transactions are recorded in a journal in order by date. --> the accounting entries are transferred to the ledger accounts. Usefulness of the General Journal ~The chief purpose of the general journal is to provide a continuous record of t he accounting entries in the order in which they occur. ~Reduces errors and prevents problems from occurring later. ~Useul for reference (verify a transaction, especially when balancing the ledger ). The Opening Entry ~Every accounting entry is recorded first in the journal. ~starts: opening entry. 6.2Source Documents ~a source document is a business paper that shows the nature of a transaction an d provides all the information deeded to account for it properly. ~a basis for recording the accounting entries. ~journey entries are considered to be basic source documents b/c they are used i n the most common business transactions. Cash Sales Slip ~a business form showing the details of a transaction in which goods or services are sold to a customer for cash. ~an original and two copies ~debit bank, credit sales Sales Invoice ~a business form showing the details of a transaction in which goods or services are sold on account. ~an original and several copies ~party that sells- vendor; party that buys- purchaser ~debit A/R, credit sales Purchase Invoice ~a business form representing a purchase of goods or services on account ~used to differentiate b/t its own sales invoices and those of its suppliers (pu rchaser) ~debit_____ (equpiment repairs, expenses, etc; depends on the nature of the good s/services purchased), credit A/P (always) Cheque Copies ~a document supporting the accounting entry for a payment by cheque. ~may be issued for number of reasons: cash purchases, wages, drawing, A/P, etc. ~debit A/P, credit bank Cash Receipts Daily Summary ~business pa per that lists the money coming in fron customers. ~remittance advice is a form accomplanying the chque explaining the payment.

~debit bank, credit A/R Bank Advices ~bank debit advice is a bank document informing the business of a decrease made in the business's bank account. credit bank account and debit appropriate accoun t. ~bank credit advice is a bank document informing the business of an increase mad e in the business's bank. debit bank account and credit appropriate account. GAAP-The Cost Principle ~accounting for purchases must be at the cost price to the purchaser. 6.3Provincial Saltes Tax ~remit to the government by the 15th of the following 6.4The Goods and Services ~HST= harmonized sales tax.