2 General Journal General Journal A journal where all types of entries can be recorded.There are only two amount columns and used when the business cannot attribute the account to any of the special journals.
3 Purchases Returns and Allowances When a customer is unsatisfied with merchandise, they are typically allowed to return part or all of their merchandise. This type of transaction is a Purchases Return. If the product is still usable or of lesser quality the vendor may offer a decrease in the account payable. This type of transaction is a Purchase Allowance A debit memorandum is a document the customer creates to identify the return or allowances.
4 DEBIT MEMORANDUM FOR PURCHASES RETURNS AND ALLOWANCES Lesson 18-4, page 471
5 JOURNALIZING PURCHASES RETURNS AND ALLOWANCES March 8. Returned merchandise to Second Round, Inc. $143.00, covering Purchase Invoice No Debit memorandum No. 78.Accounts AffectedAccounts PayablePurchases Returns and AllowancesClassificationLiabilityContra costChangeIncreasedEnteredDebit sideCredit sideBalSecond Round, Inc.ACCOUNTS PAYABLE LEDGERGENERAL LEDGERAccounts PayablePurchases Returns and Allowancesnormal balancenormal balance143.00143.00(New Bal )normal balance143.00Lesson 18-1, page 472
6 JOURNALIZING PURCHASES RETURNS AND ALLOWANCES 12345671. Write the date.2. Write the account title and vendor name in the Account Title column.3. Place a diagonal line in the Post. Ref. column.4. Write the debit memorandum number.5. Write the debit amount.6. Write the account title.7. Write the credit amount.Lesson 18-4, page 472
7 JOURNALIZING BUYING SUPPLIES ON ACCOUNT Because supplies are not merchandise, they would not be recorded in the Purchase Journal, use the General Journal.- March 9. Bought supplies on account from Winter Supplies, $ Memorandum No. 26.Accounts AffectedSuppliesAccounts PayableClassificationAssetLiabilityChangeIncreasedEnteredDebit sideCredit sideGENERAL LEDGERSuppliesAccounts PayableWinter SuppliesACCOUNTS PAYABLE LEDGERnormal balancenormal balance316.00316.00normal balance316.00Lesson 18-4, page 473
8 JOURNALIZING BUYING SUPPLIES ON ACCOUNT 42316571. Write the date.2. Write the account title.33. Write the memorandum number.4. Write the debit amount.5. Write the account title and vendor name in the Account Title column.6. Place a diagonal line in the Post. Ref. column.7. Write the credit amount.Lesson 18-4, page 473
9 POSTING FROM A GENERAL JOURNAL 21. Date1352. Journal Page Number3. Credit4. Account Balance5. Account Numbers4Lesson 18-4, page 474