SOURCE DOCUMENTS Chapter 6.2

Source Documents A business paper that shows the nature of a transaction and provides all of the information needed to account for it properly. Almost every accounting entry is based on a source document. Provides factual evidence to verify transactions of the business.

Source Documents: Cash Sales Slips A business form showing the details of a transaction in which a good or service are sold to a customer for cash. Often called Cash Receipts Cash Sales or A/R

Source Documents: Sales Invoice Sale on credit (account) Journal Entry: A/R Sales

Source Documents: Purchase Invoice Purchase item on credit (account) dr ??? (Asset) cr A/P

Source Documents: Cheques Necessary proof of transactions Cheques written: payment by us,  dr A/P cr Cash Cheques received:  dr Cash cr Sales

Source Documents: Other Memos: e.g., owner withdraws supplies for personal use; dr. Drawings, cr Supplies Bank Credit Memo: bank gives you cash, e.g., interest; dr Cash cr Interest Revenue Bank Debit Memo: bank withdraws cash from your account, e.g., service charge; dr Bank Charges cr Cash