CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 10-2 Journalizing Cash Receipts Using a Cash Receipts Journal

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning Sales Transactions Cash Sale—A sale in which cash is received for the total amount of the sale “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 VISA, MasterCard, Discover are examples. The customer would end up paying THEM not the seller!!!! 2 LESSON 10-2

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning Sales Transactions Point-of-Sale (POS) terminal—a computer used to collect, store, and report all the information of a sales transaction Terminal Summary—the report that summarizes the cash and credit card sales of a POS terminal Used as the source document for recording Sales in the journals 3 LESSON 10-2

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 4 LESSON 10-2 PROCESSING SALES TRANSACTIONS pages UPC (Universal Product Code) Cash Register Receipt Point-of-Sale (POS) Terminal Receipt (continued on next slide) Scanned to enter data into a POS terminal Contains detailed information about the sale Report of ALL cash and credit card sales

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 5 LESSON 10-2 PROCESSING SALES TRANSACTIONS page 277 Terminal Summary Batch Report Source document used for journalizing cash and credit card sales Report of credit card sales produced by the POS terminal Batching Out—process of preparing a batch report of credit card sales from POS terminal to go to bank

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 6 LESSON 10-2 CASH RECEIPTS JOURNAL page 278 Cash Receipts Journal—a special journal used to record ONLY cash receipt transactions Sales Discounts—a cash discount on SALES taken by a customer, usually to encourage EARLY payment

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 7 LESSON 10-2 CASH AND CREDIT CARD SALES page 279 November 4. Recorded cash and credit card sales, $5,460.00, plus sales tax, $327.60; total, $5, Terminal Summary Write the date. 2.Place a check mark in the Account Title column. 3.Write the terminal summary document number. 4.Place a check mark in the Post. Ref. column. 5.Write the sales amount. 6.Write the sales tax amount. 7.Write the cash amount. 7

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 8 LESSON 10-2 CASH RECEIPTS ON ACCOUNT page 280 November 6. Received cash on account from Country Crafters, $2,162.40, covering S69. Receipt No Write the date. 2.Write the customer’s name. 3.Write the receipt number. 4.Write the credit amount. 5.Write the debit amount.

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 9 LESSON 10-2 JOURNALIZING CASH RECEIPTS ON ACCOUNT WITH SALES DISCOUNTS page 282 November 7. Received cash on account from Cumberland Center, $1,176.00, covering Sales Invoice No. 74 for $1,200.00, less 2% discount, $ Receipt No Write the original invoice amount.1.Write the date. 2.Write the customer’s name. 3.Write the receipt number. 5.Write the amount of sales discount. 6.Write the debit to cash. Sales Discount Calculation: $ *.02 = $24.00 taken OFF therefore the cash DEBIT is only the difference owed or $

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 10 LESSON 10-2 TOTALING, PROVING, AND RULING A CASH RECEIPTS JOURNAL page 283 Total ALL special journals at the END OF THE MONTH! Make sure that ALL the Debits equal ALL the Credits

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning Proving Cash Proving Cash—Verifying that the Cash in the Cash General Ledger EQUALS the amount of Cash in the Checkbook!! Cash on Hand at beginning of month PLUS total Cash Received (Cash Rec. Journal) EQUALS Total LESS Total Cash Paid (Cash Payment Journal) EQUALS Cash Balance on Hand at END = CHECKBOOK BALANCE ON THE NEXT STUB 11 LESSON 10-2

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 12 LESSON 10-2 TERMS REVIEW cash sale credit card sale point-of-sale (POS) terminal terminal summary batch report batching out cash receipts journal sales discount page 284

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning Audit Your Understanding 1.What is the difference in the receipt received by a customer from a cash register versus a point-of-sale terminal? 2.What are the two types of batch reports? 3.Who transfers funds between banks involved in the credit card sales? 13 LESSON 10-2