0. Chapter 16, Section 2 Special Journals: Sales and Cash Receipts
What Do You Think?
What column headings do you think will be listed in the cash receipts journal?
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

1. The Cash Receipts Journal
SECTION 16.2
Main Idea
Cash receipts journal is used to record the cash a business receives.
You Will Learn
how to use the cash receipts journal.
the purpose of the schedule of accounts receivable.
about Internet sales.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

2. The Cash Receipts Journal
SECTION 16.2
Key Terms
cash receipts journal
schedule of accounts receivable
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

3. The Cash Receipts Journal
SECTION 16.2
Journalizing and Posting to the Cash Receipts Journal
The cash receipts journal is a special journal used to record all cash receipt transactions. Every entry debits the Cash in Bank account.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

4. The Cash Receipts Journal
SECTION 16.2
Recording Cash from Charge Customers
Follow these steps when journaling cash receipts from charge customers:
Enter the transaction date in the Date column.
Enter the receipt number in the Document Number column.
Enter the customer’s name in the Account Name column.
Enter the decrease in the amount owed in the Accounts Receivable Credit column.
Enter the amount of cash received in the Cash in Bank Debit column.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

5. The Cash Receipts Journal
SECTION 16.2
Recording Cash Received on Account, Less a Cash Discount
Follow these steps to record a cash receipt transaction with a cash discount:
Enter the receipt date in the Date column.
Enter the receipt number in the Document Number column.
Enter the customer’s name in the Account Name column.
Enter the original sales transaction amount in the Accounts Receivable Credit column.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

6. The Cash Receipts Journal
SECTION 16.2
Recording Cash Received on Account, Less a Cash Discount
Enter the cash discount amount in the Sales Discounts Debit column.
Enter the amount of cash received in the Cash in Bank Debit column.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

7. The Cash Receipts Journal
SECTION 16.2
Recording Cash Sales
Follow these steps to enter cash sales in the cash receipts journal:
Enter the cash register tape date in the Date column.
Enter the tape number in the Document Number column.
Enter Cash Sales in the Account Name column.
Enter a dash in the Posting Reference column.
Enter the amount of merchandise sold in the Sales Credit column.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

8. The Cash Receipts Journal
SECTION 16.2
Recording Cash Sales
Enter the sales taxes collected in the Sales Tax Payable Credit column.
Enter the total cash received in the Cash in Bank Debit column.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

9. The Cash Receipts Journal
SECTION 16.2
Recording Bankcard Sales
Follow these steps to enter bankcard sales in the cash receipts journal:
Enter the cash register tape date in the Date column.
Enter the tape number in the Document Number column.
Enter Bankcard Sales in the Account Name column.
Enter a dash in the Posting Reference column.
Enter the amount of merchandise sold in the Sales Credit column.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

10. The Cash Receipts Journal
SECTION 16.2
Recording Bankcard Sales
Enter the sales taxes collected in the Sales Tax Payable Credit column.
Enter the total cash received in the Cash in Bank Debit column.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

11. The Cash Receipts Journal
SECTION 16.2
Recording Other Cash Receipts
Follow these steps to record in the cash receipts journal a transaction that does not involve the sale of merchandise:
Enter the receipt date in the Date column.
Enter an R and the receipt number in the Document Number column.
Enter the general ledger account name in the Account Name column.
Enter the credit amount in the General Credit column.
Enter the total cash received in the Cash in Bank Debit column.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

12. The Cash Receipts Journal
SECTION 16.2
Posting to the Accounts Receivable Subsidiary Ledger
Follow these steps to post a cash receipt transaction to an account in the accounts receivable subsidiary ledger:
Enter the transaction date in the Date column of the subsidiary ledger account.
Enter the journal letters and page number in the Posting Reference column.
Enter the amount from the Accounts Receivable Credit column of the cash receipts journal in the subsidiary ledger Credit column.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

13. The Cash Receipts Journal
SECTION 16.2
Posting to the Accounts Receivable Subsidiary Ledger
Enter the new balance in the Balance column. If it is zero, draw a line through it.
Enter a check mark in the Posting Reference column of the cash receipts journal.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

14. The Cash Receipts Journal
SECTION 16.2
Posting the General Credit Column
Follow these steps to post from the General Credit column of the cash receipts journal:
Enter the transaction date in the Date column of the general ledger.
Enter the journal letters and page number in the Posting Reference column.
Enter the amount from the General Credit column of the cash receipts journal.
Enter the new balance in the proper Balance column. If it is zero, draw a line through it.
Enter the general ledger account number in the Posting Reference column of the cash receipts journal.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

15. The Cash Receipts Journal
SECTION 16.2
Posting the General Credit Column
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

16. The Cash Receipts Journal
SECTION 16.2
Footing, Proving, Totaling, and Ruling the Cash Receipts Journal
Follow these steps to complete the cash receipts journal:
Draw a single rule across the six amount columns below the last transaction.
Foot the columns.
Verify the debits and credits are equal.
Enter the date the journal is being totaled in the Date column.
Enter Totals in the Account Name column.
Enter the column totals, in ink, below the footings.
Double-rule the amount columns.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

17. The Cash Receipts Journal
SECTION 16.2
Footing, Proving, Totaling, and Ruling the Cash Receipts Journal
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

18. The Cash Receipts Journal
SECTION 16.2
Posting Column Totals to the General Ledger
Follow these steps to post totals to the general ledger:
Place a check mark in parentheses under the General Credit column total.
Post the Sales total to the Sales account Credit column.
Post the Sales Tax Payable total to the Sales Tax Payable account Credit column.
Post the Accounts Receivable total to the Accounts Receivable controlling account Credit column.
Post the Sales Discounts total to the Sales Discounts account Debit column.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

19. The Cash Receipts Journal
SECTION 16.2
Posting Column Totals to the General Ledger
Post the Cash in Bank total to the Cash in Bank account debit column.
Compute new balances for each general ledger account.
Write each account number in parentheses below the double rule in the cash receipts journal.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

20. The Cash Receipts Journal
SECTION 16.2
Using the Schedule of Accounts Receivable
A schedule is prepared for each subsidiary ledger to determine whether the subsidiary ledger’s sum equals the controlling account’s ending balance.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

21. The Cash Receipts Journal
SECTION 16.2
Proving the Accounts Receivable Subsidiary Ledger
The schedule of accounts receivable is used to prove the receivable subsidiary ledger. The balance of Accounts Receivable in the general ledger should equal the individual accounts receivable subsidiary ledger totals.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

22. The Cash Receipts Journal
SECTION 16.2
Detecting Errors in the Subsidiary Ledger Some errors that could exist in the subsidiary ledger are
failing to post a transaction, or
miscalculating an account balance.
Proving the accounts receivable subsidiary ledger does not ensure that transactions were posted to the correct customer account.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

23. The Cash Receipts Journal
SECTION 16.2
Internet Sales
Companies can sell products with little expense and effort over the Internet. An Internet merchant account for credit and debit card payments or an online payment service can be used for these sales transactions.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

24. The Cash Receipts Journal
SECTION 16.2
Key Terms Review
cash receipts journal
A special journal used to record all transactions in which cash is received.
schedule of accounts receivable
A list of each charge customer, the balance in the customer’s account, and the total amount due from all customers.
Glencoe Accounting Unit 4 Chapter 16 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.