Kế toán tài chính 2 - Chapter 7: Accounting information systems

Accounting Information SystemsMultimedia Slides by: Gail A. Mestas, MAcc, New Mexico State UniversityChapter 7Learning ObjectivesIdentify the principles of designing accounting information systems.Describe the use and structure of spreadsheet software and general ledger systems in computerized accounting systems.Explain how accountants and businesses use the Internet.2Copyright © Houghton Mifflin Company. All rights reserved.Learning Objectives (cont’d)Describe the role of special-purpose journals and their relationship to controlling accounts and subsidiary ledgers.Construct and use a sales journal, purchases journal, cash receipts journal, and cash payments journal.3Copyright © Houghton Mifflin Company. All rights reserved.Principles of Accounting Information Systems DesignObjective 1Identify the principles of designing accounting information systems4Copyright © Houghton Mifflin Company. All rights reserved.Accounting Information Systems summarize financial data about a business and organize the data into useful formsAccomplished by means of data processingAccountants communicate results to managementManagement uses resulting data to make decisions5Copyright © Houghton Mifflin Company. All rights reserved.Enterprise Resource Planning (ERP) SystemsComprehensive information systemsIntegrateFinancial and nonfinancial informationCustomer, operations, and supplier informationAccounting serves as the baseAre set up, monitored, and operated by accountantsImpossible to use without a basic knowledge of accounting 6Copyright © Houghton Mifflin Company. All rights reserved.General Principles of Accounting Information Systems DesignCost-benefit principleControl principleCompatibility principleFlexibility principleAnalysis of computer system choices begins with these four principles7Copyright © Houghton Mifflin Company. All rights reserved.Cost-Benefit PrincipleHolds that the benefits derived from a system and the information it generates must be equal to or greater than its costsBenefits ≥ CostThe most important systems principle8Copyright © Houghton Mifflin Company. All rights reserved.Cost-Benefit Principle (cont’d)The benefits must be weighed against tangible and intangible costsTangible costsPersonnel, forms, equipmentIntangible costsCost of wrong decisions resulting from the lack of good information9Copyright © Houghton Mifflin Company. All rights reserved.Control PrincipleRequires that an accounting system provide all the features of internal control needed toProtect the company’s assetsEnsure that data are reliable ExampleExpenditures should be approved by a responsible member of management before they are made10Copyright © Houghton Mifflin Company. All rights reserved.Compatibility PrincipleHolds that the design of an accounting system must be in harmony with the organizational and human factors of a businessIn other words, If the company is organized by region, its accounting system should report revenues and expenses by regionThe people who carry out company procedures must understand, accept, and be able to operate the accounting system11Copyright © Houghton Mifflin Company. All rights reserved.Flexibility PrincipleHolds that an accounting system must be flexible enough to allowThe volume of transactions to growOrganizational changes to be made without having to make major alterations to the accounting systemExampleShould be able to add new accounts to the chart of accounts12Copyright © Houghton Mifflin Company. All rights reserved.DiscussionWhat are the four general principles of accounting information systems design?Cost-benefit principleControl principleCompatibility principleFlexibility principle13Copyright © Houghton Mifflin Company. All rights reserved.Computerized Accounting SystemsObjective 2Describe the use and structure of spreadsheet software and general ledger systems in computerized accounting systems14Copyright © Houghton Mifflin Company. All rights reserved.Computerized Accounting SystemsGoalMeet all computing needs at the lowest possible costPC or microcomputer systems are used by most large and small companiesImportant as companies increase use of the Internet for business communications and transactions15Copyright © Houghton Mifflin Company. All rights reserved.Computerized Accounting SystemsAccountants use both general ledger systems and spreadsheet softwareGeneral ledger systemsUsed for transactions that require double-entry accountingSpreadsheet softwareUsed to analyze data16Copyright © Houghton Mifflin Company. All rights reserved.Spreadsheet SoftwareA grid made up of columns and rowsData or formulas are placed into cells on the gridUsed for Financial planningCost estimatingOther accounting tasksPopular spreadsheet programsWindows® ExcelLotus17Copyright © Houghton Mifflin Company. All rights reserved.General Ledger SystemsGroup of integrated software programsUsed to perform major accounting functions such asSales and accounts receivablePurchases and accounts payablePayrollMost general ledger systems use a Windows® operating systemWindows® has a graphical user interface18Copyright © Houghton Mifflin Company. All rights reserved.Popular General Ledger SystemsGeneral Ledger SoftwarePeachtree Complete Accounting™ for Windows®QuickBooks®19Copyright © Houghton Mifflin Company. All rights reserved.Graphical User Interface (GUI)Uses symbols (called icons) to represent common operationsClicking the icon of a printer will initiate the printing processClicking the icon of a diskette will save the file currently in useA mouse or keyboard may be usedEasy to useAny program using Windows® as its GUI is Windows® -compatibleUses standard terms and operations within the software program20Copyright © Houghton Mifflin Company. All rights reserved.Structure of General Ledger SystemsOrganized so that each module performs a major task of the accounting systemThere is a software module, or feature, for each major accounting functionSales/accounts receivablePurchases/accounts payableCash receiptsCash disbursementsPayrollGeneral journal21Copyright © Houghton Mifflin Company. All rights reserved.Source DocumentsWritten evidence that a transaction occurredProvide the details of the transactionEvery transaction should be supported by a source documentShould be kept even if transactions are recorded by the computer22Copyright © Houghton Mifflin Company. All rights reserved.Source Documents As InputPurchases/accounts payableCash disbursementsPayrollGeneral journalVendor invoicesDepositsChecksTime cardsJournal entriesSales/accounts receivableCustomer invoicesAccounting FunctionSource DocumentCash receipts23Copyright © Houghton Mifflin Company. All rights reserved.Functions of the General Ledger SystemTransactions are recorded from source documents in the general ledger systemOnce processed, the system posts the transactions Ledgers are updatedThe trial balance is preparedFinancial statements and other reports are printed24Copyright © Houghton Mifflin Company. All rights reserved.Posting in a General Ledger SystemBatch postingSource documents are recorded in the appropriate ledger and savedPosting is done, in batches, at the end of the day, week, or monthReal-time postingDocuments are posted as they are entered into the system25Copyright © Houghton Mifflin Company. All rights reserved.Basic Goal of General Ledger Systems To computerize existing accounting tasksSaves timeImproves accuracyImproves dependabilityKnowledge of the underlying accounting process is necessary to Ensure that accounting records are accurateProtect the assets of the businessAid in the analysis of financial statements26Copyright © Houghton Mifflin Company. All rights reserved.DiscussionWhat are the two types of software accountants generally use?Spreadsheet softwareUsed to analyze dataGeneral ledger systemsUsed for transactions that require double-entry accounting 27Copyright © Houghton Mifflin Company. All rights reserved.DiscussionIdentify three source documents that would support entries into an accounting systemTypical source documents would includeCustomer invoicesVendor invoicesDepositsChecksTime cards28Copyright © Houghton Mifflin Company. All rights reserved.Accountants and the InternetObjective 3Explain how accountants and businesses use the Internet29Copyright © Houghton Mifflin Company. All rights reserved.The InternetWorld’s largest computer networkAny computer in the network can communicate with any other computer in the networkComputers connect to the Internet using a modem connected to a phone lineA subscription to an Internet service provider (ISP) is necessaryAmerica Online (AOL)MCI WorldComAT&TLocal service providers30Copyright © Houghton Mifflin Company. All rights reserved.Uses of the Internet by AccountantsWorldwide WebA repository that provides access to information over the InternetElectronic mail (email)The sending and receiving of communications over a computer networkElectronic bulletin boardsAllow people with common interests to share informationFinancial reportingPublishing financial statements on the InternetRequired by SEC31Copyright © Houghton Mifflin Company. All rights reserved.Uses of the Internet by Accountants (cont’d)Extensible Business Reporting Language (XBRL)Computer language developed to identify and communicate financial informationElectronic commerce (ecommerce)The conduct of business transactions over the InternetElectronic Data Interchange (EDI)Private networks for buying and selling goods32Copyright © Houghton Mifflin Company. All rights reserved.Uses of the Internet by Accountants (cont’d)Supply-chain managementUsing the Internet to track supplies and materials a manufacturer needs on a day-to-day basisEvent-to-knowledge management (E2K)Using the Internet to notify users within and outside the company, as quickly as possible, that a transaction has occurred (such as a sale or purchase)Document-less transactionsTransactions conducted electronically that do not require source documents for back-upStill being developed33Copyright © Houghton Mifflin Company. All rights reserved.What is supply chain management and how does it involve the Internet?Supply chain management involves using the Internet to track supplies and materials a manufacturer needs on a day-to-day basisDiscussion34Copyright © Houghton Mifflin Company. All rights reserved.Role of Special-Purpose Journals in an Accounting Information SystemObjective 4Describe the role of special-purpose journals and their relationship to controlling accounts and subsidiary ledgers35Copyright © Houghton Mifflin Company. All rights reserved.Manual Data ProcessingEach transaction is entered from a source document into the general journalEach debit and credit is then posted to the correct ledger accountOnly used in the smallest of companiesNot efficient for high volumes of transactionsSpecial-purpose journals are the easiest approach for a more efficient and economical way of recording and posting transactions 36Copyright © Houghton Mifflin Company. All rights reserved.Special-Purpose JournalsTypical transactions are grouped into common categoriesEach category has its own special-purpose journalObjectivesEfficiencyEconomyControlConcepts underlying special-purpose journals also underlie software programs for computerized accounting systems37Copyright © Houghton Mifflin Company. All rights reserved.Special-Purpose Journals90 - 95 percent of business transactions fall into one of four categoriesSale of merchandise on creditPurchase on creditReceipt of cashDisbursement of cashEach kind of transaction can be recorded in a special-purpose journal38Copyright © Houghton Mifflin Company. All rights reserved.Special-Purpose JournalsTransactions that do not fall into any of the special categories are recorded in the general journalExamplesPurchase returnsSales returnsAdjusting and closing entriesWhen posting from the general journal to the ledger accounts, the posting abbreviation is JSales journalSPurchase on creditPurchases journalPReceipt of cashCash receipts journalCRDisbursement of cashCash payments journalCP39Copyright © Houghton Mifflin Company. All rights reserved.Advantages of Special-Purpose JournalsGreatly reduce work involved in entering and posting transactionsLabor can be dividedEach journal assigned to a different employeeGood internal control40Copyright © Houghton Mifflin Company. All rights reserved.Controlling Accounts and Subsidiary LedgersControlling accountAn account in the general ledger that maintains a total balance of all related accounts in a subsidiary ledgerAlso called a control accountSubsidiary ledgerA ledger separate from the general ledgerContains a group of related accountsTotal of the balances in the = Balance in corresponding subsidiary ledger accounts control account41Copyright © Houghton Mifflin Company. All rights reserved.Controlling Accounts and Subsidiary LedgersContain important details about the figures in special-purpose journals and other books of original entry42Copyright © Houghton Mifflin Company. All rights reserved.Example: Accounts ReceivableRecord each sale on credit in the sales journalPost from the sales journal to each customers’ account in the accounts receivable subsidiary ledger dailyPost total from the sales journal to the Accounts Receivable account in the general ledger at least once a monthSpecial-purpose journalSubsidiary ledgerControlling account√√√43Copyright © Houghton Mifflin Company. All rights reserved.Example: Accounts ReceivableSpecial-purpose journalSubsidiary ledgerControlling account√√√After posting to the controlling account, the total of the balances in the Accounts Receivable subsidiary ledger should equal the balance in the Accounts Receivable controlling account44Copyright © Houghton Mifflin Company. All rights reserved.DiscussionWhat is the relationship between a controlling account and the related accounts in the subsidiary ledger?The controlling account is an account in the general ledger that maintains a total balance of all related accounts in a subsidiary ledger The total of the balances in the subsidiary ledger accounts should equal the balance in the corresponding control account45Copyright © Houghton Mifflin Company. All rights reserved.Types of Special-Purpose JournalsObjective 5Construct and use a sales journal, purchases journal, cash receipts journal, and cash payments journal46Copyright © Houghton Mifflin Company. All rights reserved.Types of Special-Purpose JournalsSales journalPurchases journalCash receipts journalCash disbursements journal47Copyright © Houghton Mifflin Company. All rights reserved.Sales JournalDesigned to handle all credit salesCash sales are recorded in the cash receipts journal48Copyright © Houghton Mifflin Company. All rights reserved.Sales JournalOnly one line is needed to record each transactionEach entry consists of a debit to Accounts ReceivableThe credit to Sales is understood49Copyright © Houghton Mifflin Company. All rights reserved.Sales JournalAccount names do not have to be written outEach entry is automatically debited to Accounts Receivable and credited to Sales50Copyright © Houghton Mifflin Company. All rights reserved.Sales JournalNo explanations are necessaryThe function of the sales journal is to record credit sales only51Copyright © Houghton Mifflin Company. All rights reserved.Sales JournalOnly one amount has to be postedTotal credit salesPosted twiceDebit to Accounts ReceivableCredit to Sales52Copyright © Houghton Mifflin Company. All rights reserved.Using a Sales JournalEnter each sales invoice on a single lineRecord date, customer’s name, invoice number, and the amountIf terms on sales are all the same, no Terms column is neededJuly 1 Peter Clark 721 75053Copyright © Houghton Mifflin Company. All rights reserved. 5 Georgetta Jones 722 500July 1 Peter Clark 721 750√ July 1 750 750Using a Sales Journal (cont’d)At the end of each day, post each individual sale to the customer’s account in the accounts receivable subsidiary ledgerS1As each sale is posted, place a checkmark (or customer account no.) in the Post. Ref. column of the sales journalPlace an S and the sales journal page no. in the Post. Ref. column of each customer’s account√July 5 500 500S154Copyright © Houghton Mifflin Company. All rights reserved.Using a Sales Journal (cont’d)At the end of each month, sum the Amount column in the sales journal and post to the general ledger accountsPlace the numbers of the accounts debited and credited beneath the total in the sales journal to indicate this step has been completedIn the general ledger,place an S and the sales journal page no. in the Post. Ref. column of each accountS1S14,950(114/411)55Copyright © Houghton Mifflin Company. All rights reserved.Using a Sales Journal (cont’d)Verify the accuracy of the postingAdd the account balances of the accounts receivable subsidiary ledgerCompare the total with the balance of the Accounts Receivable controlling account in the general ledger This can be done by listing the accounts in a schedule of accounts receivable56Copyright © Houghton Mifflin Company. All rights reserved.Recording Sales Tax Payable in a Sales JournalMany cities and states require retailers to collect sales tax from their customers and remit the amount collected to the city or stateAn additional column is needed in the sales journal to record the credit to Sales Tax Payable on credit salesThe procedure for posting to the ledger is exactly the same except the total of the Sales Tax Payable column must also be posted as a credit to the Sales Tax Payable account at the end of the month57Copyright © Houghton Mifflin Company. All rights reserved.Purchases JournalDesigned to handle all purchases on creditSingle-columnOnly credit purchases of merchandise for resale are recordedCredit purchases for items other than merchandise are recorded in the general journalMulticolumnAll credit purchases are recordedCash purchases are recorded in the cash payments journal58Copyright © Houghton Mifflin Company. All rights reserved.Example of a Single-Column Purchases JournalA separate account is kept in the accounts payable subsidiary ledger for each supplierThe Accounts Payable account in the general ledger is used as the controlling account59Copyright © Houghton Mifflin Company. All rights reserved.Using a Purchases JournalEnter each purchase invoice on a single lineRecord date, supplier’s name, invoice date, the terms (if given), and the amount60Copyright © Houghton Mifflin Company. All rights reserved.Using a Purchases Journal (cont’d)At the end of each day, post each individual purchase to the supplier’s account in the accounts payable subsidiary ledgerAs each purchase is posted, place a checkmark in the Post. Ref. column of the purchases journalPlace a P and the purchases journal page no. in the Post. Ref. column of each supplier’s account√2 Marshall Ford 7/2 2/10, n/30 300July 1 2,500 2,500July 1 Jones Chevrolet 7/1 2/10, n/30 2,500P1July 2 300 300√P161Copyright © Houghton Mifflin Company. All rights reserved.Using a Purchases Journal (cont’d)At the end of each month, sum the Amount column in the purchases journal and post to the general ledger accountsPlace the numbers of the accounts debited and credited beneath the total in the purchases journal to indicate this step has been completedIn the general ledger,place a P and the purchases journal page no. in the Post. Ref. column of each account(212/511)P1P162Copyright © Houghton Mifflin Company. All rights reserved.Using a Purchases Journal (cont’d)Verify the accuracy of the postingAdd the account balances of the accounts payable subsidiary ledger Compare the total with the balance of the Accounts Payable controlling account in the general ledger This can be done by listing the accounts in a schedule of accounts payable63Copyright © Houghton Mifflin Company. All rights reserved.Multicolumn Purchases JournalThe single-column purchases journal can be expanded to record credit purchases of items other than merchandiseAdd separate debit columns for other accounts that are used oftenIndividual transactions are posted dailyColumn totals are posted monthly64Copyright © Houghton Mifflin Company. All rights reserved.Multicolumn Purchases Journal65Copyright © Houghton Mifflin Company. All rights reserved. Cash Receipts JournalDesigned to handle all transactions involving receipts of cashExamplesCash from salesCash payment from credit customers66Copyright © Houghton Mifflin Company. All rights reserved. Cash Receipts Journal (cont’d) This example includesThree debit columnsThree credit columns 67Copyright © Houghton Mifflin Company. All rights reserved. Cash Receipts Journal (cont’d) Cash ColumnEach entry must have an amount in this column because each transaction involves a receipt of cash68Copyright © Houghton Mifflin Company. All rights reserved. Cash Receipts Journal (cont’d) Sales Discounts ColumnUseful when a company offers sales discountsNotice that the debits to Cash and Sales Discounts equal the credit to Accounts Receivable 69Copyright © Houghton Mifflin Company. All rights reserved. Cash Receipts Journal (cont’d) Other Accounts ColumnUsed for transactions that involve both a debit to Cash and a debit to an account other than Sales DiscountsAlso called Sundry Accounts70Copyright © Houghton Mifflin Company. All rights reserved. Cash Receipts Journal (cont’d) Accounts Receivable ColumnUsed to record collections on account from customers71Copyright © Houghton Mifflin Company. All rights reserved. Cash Receipts Journal (cont’d) Accounts Receivable ColumnName of customer is recorded in the Account Debited/Credited columnPosting to individual accounts receivable is usually done daily to keep each customer’s balance up to date72Copyright © Houghton Mifflin Company. All rights reserved. Cash Receipts Journal (cont’d) Sales ColumnUsed to record all cash sales during the monthRetailers using cash registers make an entry at the end of each day for the total sales from each register for that day 73Copyright © Houghton Mifflin Company. All rights reserved. Cash Receipts Journal (cont’d) Other Accounts ColumnUsed for the credit portion of each entry that is neither a cash collection for Accounts Receivable nor a cash sale74Copyright © Houghton Mifflin Company. All rights reserved.Other Accounts ColumnName of the account to be credited is located in the Account Debited/Credited column Cash Receipts Journal (cont’d) These individual postings should be done daily75Copyright © Houghton Mifflin Company. All rights reserved.Other Accounts ColumnIf a certain account is consistently credited in this column, an additional column should be added for that account Cash Receipts Journal (cont’d) 76Copyright © Houghton Mifflin Company. All rights reserved. Using a Cash Receipts JournalPost the transactions in the Accounts Receivable column daily to the individual accounts in the accounts receivable subsidiary ledger √8 CR1 500 − √16 CR1 750 − √28 CR1 600 625 18 S1 1,225 1,225 77Copyright © Houghton Mifflin Company. All rights reserved. Using a Cash Receipts JournalPost the debits/credits in the Other Accounts column daily, or at convenient short intervals during the month, to the general ledger accountsJuly 1 CR1 20,000 20,000 31178Copyright © Houghton Mifflin Company. All rights reserved. Using a Cash Receipts JournalPost the debits/credits in the Other Accounts column daily, or at convenient short intervals during the month, to the general ledger accountsJuly 20 CR1 500 − 13279Copyright © Houghton Mifflin Company. All rights reserved. Using a Cash Receipts JournalPost the debits/credits in the Other Accounts column daily, or at convenient short intervals during the month, to the general ledger accountsJuly 24 CR1 5,000 5,000 21380Copyright © Houghton Mifflin Company. All rights reserved. Using a Cash Receipts JournalAt the end of the month, total the columns in the cash receipts journal 32,528 22 1,850 5,200 25,500The sum of the Debits column totals must equal the sum of the Credits column totals81Copyright © Houghton Mifflin Company. All rights reserved. Using a Cash Receipts JournalPost the Debits column totals to the Cash account and the Sales Discounts account32,528 22 1,850 5,200 25,500July 31 CR1 32,528 32,528(111)July 31 CR1 22 22(412)82Copyright © Houghton Mifflin Company. All rights reserved. Using a Cash Receipts JournalPost the Credits column totals to the Accounts Receivable controlling account and the Sales account32,528 22 1,850 5,200 25,500(111)(412) 31 CR1 1,850 3,100(114)July 31 CR1 5,200 5,200(411)July 1 S1 4,950 4,95083Copyright © Houghton Mifflin Company. All rights reserved. Using a Cash Receipts JournalTo indicate that posting has been completed, the appropriate account number is written under the column total in the cash receipts journal32,528 22 1,850 5,200 25,500 (111)(412) 31 CR1 1,850 3,100(114)July 31 CR1 5,200 5,200(411)July 1 S1 4,950 4,95084Copyright © Houghton Mifflin Company. All rights reserved. Using a Cash Receipts Journal CR1 is written in the Post. Ref. column of each account in the general ledger to indicate the source of the entry32,528 22 1,850 5,200 25,500(111)(412) 31 CR1 1,850 3,100(114)July 31 CR1 5,200 5,200(411)July 1 S1 4,950 4,95085Copyright © Houghton Mifflin Company. All rights reserved. Using a Cash Receipts JournalThe total of the Other Accounts column is not posted because each entry was posted separately when the transactions occurred32,528 22 1,850 5,200 25,500(111)(412)(114)(411)(√)Place a checkmark at the bottom of the column to show that postings in the column have been made and that the total is not posted86Copyright © Houghton Mifflin Company. All rights reserved. Cash Payments JournalDesigned to handle all transactions involving payments of cashExamplesCash purchasesCash payments of obligations from credit purchasesAlso called the cash disbursements journal87Copyright © Houghton Mifflin Company. All rights reserved. Cash Payments Journal (cont’d)This example includesThree credit columnsTwo debit columns 88Copyright © Houghton Mifflin Company. All rights reserved. Cash Payments Journal (cont’d)Cash ColumnEach entry must have an amount in this column because each transaction involves a payment of cash 89Copyright © Houghton Mifflin Company. All rights reserved. Cash Payments Journal (cont’d)Purchases Discounts ColumnUseful when purchases discounts are taken Notice that the credits to Cash and Purchases Discounts equal the debit to Accounts Payable 90Copyright © Houghton Mifflin Company. All rights reserved. Cash Payments Journal (cont’d)Other Accounts ColumnUsed to record credits to accounts other than Cash or Purchases Discounts 91Copyright © Houghton Mifflin Company. All rights reserved. Cash Payments Journal (cont’d)Accounts Payable ColumnUsed to record payments to suppliers that have extended credit to the company 92Copyright © Houghton Mifflin Company. All rights reserved. Cash Payments Journal (cont’d) Accounts Payable ColumnThe supplier’s name is recorded in the Payee column so that payment can be entered in the supplier’s account in the accounts payable subsidiary ledger93Copyright © Houghton Mifflin Company. All rights reserved. Cash Payments Journal (cont’d)Other Accounts ColumnUsed for the debit portion of each entry that is not a cash payment for Accounts Payable Also called Sundry Accounts94Copyright © Houghton Mifflin Company. All rights reserved. Cash Payments Journal (cont’d) Other Accounts ColumnName of the account to be debited is located in the Account Debited/Credited column95Copyright © Houghton Mifflin Company. All rights reserved. Cash Payments Journal (cont’d)Other Accounts ColumnIf a certain account is consistently debited in this column, an additional column should be added for that account96Copyright © Houghton Mifflin Company. All rights reserved.Using a Cash Payments JournalPost the transactions in the Accounts Payable column daily to the individual accounts in the accounts payable subsidiary ledger 11 CP1 2,500 ―√ 17 CP1 300 ―√ 97Copyright © Houghton Mifflin Company. All rights reserved.Using a Cash Payments JournalPost the transactions in the Accounts Payable column daily to the individual accounts in the accounts payable subsidiary ledger 27 CP1 3,200 700 √ √√98Copyright © Houghton Mifflin Company. All rights reserved.Using a Cash Payments JournalPost the debits/credits in the Other Accounts debit/credit columns daily to the individual accounts in the accounts payable subsidiary ledger July 2 CP1 400 400511 July 6 CP1 200 20061299Copyright © Houghton Mifflin Company. All rights reserved.Using a Cash Payments JournalPost the debits/credits in the Other Accounts debit/credit columns daily to the individual accounts in the accounts payable subsidiary ledger511 612631 611119144146213141Continue posting the amounts in the Other Accounts columns to Rent Expense, Salaries Expense, Prepaid Insurance, Office Equipment, Service Equipment, Notes Payable, and Land100Copyright © Houghton Mifflin Company. All rights reserved. 13,710 120 10,000 6,000 17,830 Using a Cash Payments JournalAt the end of the month, total the columns in the cash receipts journal The sum of the Credits column totals must equal the sum of the Debits column totals101Copyright © Houghton Mifflin Company. All rights reserved.Using a Cash Payments JournalPost the Credits column totals for the Cash and Purchases Discounts to the respective accounts in the general ledger31 CP1 13,710 18,818(111)July 31 CP1 120 120(512)102Copyright © Houghton Mifflin Company. All rights reserved.Using a Cash Payments JournalPost the Debits column total for Accounts Payable to the respective account in the general ledgerJuly 31 CP1 6,000 ―(111)(512)(212)103Copyright © Houghton Mifflin Company. All rights reserved. July 31 CP1 6,000 ― Using a Cash Payments Journal(111)(512)(212)The appropriate account numbers have been written under the column totals in the cash payments journal to indicate amounts have been postedCP1 has been recorded in the Post. Ref. column of each general ledger account to indicate the source of each transaction104Copyright © Houghton Mifflin Company. All rights reserved.Using a Cash Payments Journal(111)(512)(212)The totals of the Other Accounts columns are not posted because each entry was posted separately when the transactions occurred(√)A checkmark is placed at the bottom of each column to show that postings in the column have been made and that the total is not posted(√)105Copyright © Houghton Mifflin Company. All rights reserved.Transactions That Are Not Recorded in a Special-Purpose JournalAdjusting and closing entriesTransactions that do not involveSalesPurchasesCash receiptsCash paymentsThese transactions are recorded in the general journal106Copyright © Houghton Mifflin Company. All rights reserved.The General JournalUsed only to record transactions that cannot be accommodated by the special-purpose journalsPostings are made dailyColumns are not totaled, and therefore, not postedControlling accounts recorded must be “double posted” to the general ledger and the subsidiary accounts107Copyright © Houghton Mifflin Company. All rights reserved.Transactions Recorded in the General Journal108Copyright © Houghton Mifflin Company. All rights reserved.The Flexibility of Special-Purpose JournalsReduce and simplify the work of accountingAllow for the division of laborCan be designed to fit the business in which they are usedNew special-purpose journals can be set up for transactions that appear repeatedly in the general journalNew columns can be added to a special-purpose journal for accounts that show up repeatedly in the Other Accounts column109Copyright © Houghton Mifflin Company. All rights reserved.In which special journal would a cash sale be recorded?The cash receipts journal. All transactions for which cash is received are recorded in this journal. If the sale had been on credit, it would have been recorded in the sales journalDiscussion110Copyright © Houghton Mifflin Company. All rights reserved.Time for ReviewIdentify the principles of designing accounting information systemsDescribe the use and structure of spreadsheet software and general ledger systems in computerized accounting systemsExplain how accountants and businesses use the Internet111Copyright © Houghton Mifflin Company. All rights reserved.And Finally Describe the role of special-purpose journals and their relationship to controlling accounts and subsidiary ledgersConstruct and use a sales journal, purchases journal, cash receipts journal, and cash payments journal112Copyright © Houghton Mifflin Company. All rights reserved.