Journalizing Transactions

1. Journalizing Transactions CA2 Accounting Principles Lesson 2

2. Now that you’re good at analyzing transactions into debit and credit parts, let’s do the same thing into a REAL accounting form…the journal. But, FIRST, let’s get a good look at a journal page and identify its parts.

3. If the affected accounts do not have a special amount column, enter the amounts in the General amount column, and the account titles go in the Account Title Column. Enter year on first line, month underneath, and date in second column Where did you get this information? Here, R1 stands for Receipt #1. If a column has an account title at the top, it is a special amount column. We use these to record Cash and Sales transactions in a 5-column journal. • Analyze the transaction: • What accounts are affected? • What category of account is each? • For each, does it increase or decrease? • For each, do you show that as a debit or as a credit?

4. Journalize the following transactions completed during May of the current year. Use the journal provided on pages 125-126 in your Working Papers. Source documents are abbreviated as follows: check Stub = C; Memorandum = M; Receipt = R; Sales Invoice = S; Calculator Tape = T.  May 1 Received cash from the owner as an investment, $17,000.00; R1.   1 Paid cash for rent, $1,200.00; C1   2 Paid cash for electric bill, $45.00; C2   4 Paid cash for supplies, $400.00; C3   4 Paid cash for insurance, $960.00; C4

5. Note how each transaction is entered. Use the back button below to check each. Then, click the forward button and use the next two pages to try it yourself. If you aren’t sure how to do it, click the words of the transaction and I’ll show you what it should look like.

6. 7 Bought supplies on account from Dunnel Supplies, $800.00; M1 11 Paid cash to establish a petty cash fund, $200.00; C5 12 Received cash from sales, $400.00; T12 13 Paid cash for repairs, $25.00; C6 13 Paid cash for miscellaneous expense, $35.00; C7 13 Received cash from Sales, $185.00; T13 13 Sold services on account to Lincoln School, $150.00; S1 14 Paid cash for advertising, $100.00; C8 15 Paid cash to the owner for personal use, $250.00; C9 15 Paid cash on account to Dunnel Supplies, $300.00; C10 15 Received cash from sales, $325.00; T15 15 Sold services on account to Breck School, $335.00; S2 18 Paid cash for miscellaneous expense, $100.00; C11 18 Received cash on account from Lincoln School, $100.00; R2 19 Received cash from Sales, $155.00; T19 20 Paid cash for repairs, $125.00; C12 20 Bought supplies on account from Voiles Office Supplies, $150.00; M2 If you aren’t sure how to do it, click the words of the transaction and I’ll show you what it should look like.

8. Double-click on spreadsheet to open it and begin typing When you are done, click here

11. Note that when both parts of a transaction is entered in special amount columns, place a check mark in the account title and Post. Ref. column to indicate that you do not need to write the account title.

26. When you finish entering transactions for one page, but have more transactions before the month is over, you need to do what is called proving and ruling the page. This means total each column, and then be sure that your debits equal the credits on the page.

27. Be sure to enter the date, the words “Carried Forward” and total each line all the way to the top of the column. Enter a check mark in the Post. Ref. Column to indicate that these totals will not be posted.

28. Now you are ready to go to the next journal page and continue making entries to the end of the month.