2 A special journal used to record only cash receipts transactions Cash Receipts JournalA special journal used to record only cash receipts transactionsDaily or weekly cash and credit card sales are recorded as a single cash transaction.Cash is debited for the total amount and sales and sales tax payable are credited
3 SalesWhen merchandise is sold, revenue is recorded at the time of the sale not when cash is received.Purchases of merchandise on account are put in the sales journalCash purchases go in the cash payments journalBuying supplies goes into the general journalSales returns and allowancesContra revenue account to salesCredit memorandumA form used to show the amount deducted for sales returns and allowancesSales discountA cash discount taken by a customerSales allowanceCredit allowed to a customer which decreases accounts receivable
4 Sales Tax & Sales Discounts Sales tax collected is recorded as a liability until paid to the state governmentSales tax is calculated by multiplying the sales amount by the sales tax percentage.Even when a sales discount is offered, the customer is invoiced for the full amount of the sale and sales tax.The discount is taken when the payment is made within the discount periodThe discount amount is taken away from the amount cash paid with the total increases the accounts receivable account with a debit.Sales discount is a contra account to sales and has a debit balance.
5 Other conceptsThe ledger balance must equal the amount on the first unused check stubPoint-of-sale terminalA computer used to collect, store, and report all of the information of a sales transaction.Terminal summaryThe report that summarizes all cash and credit card transactions of a point of sale terminal.Batch reportA report of credit card sales produced by a point-of-sale terminals.Batching outThe process of preparing a batch report of credit card sales
6 Accounting Concepts Realization of revenue Objective evidence Recording revenue from transactions at the time the goods or services are soldObjective evidenceUsing source documents such as a terminal summary as a source document for transactions such as cash and credit card salesDebit cash short and over2/10 Net 302% discount if paid within 10 days, if not due within 30 daysIf merchandise is purchased for $2,000 on October 1, with the terms 2/10 net 30, the amount due to the vendor on October 9th is $1,960.$2,000 x .02 = $ $2,000-40= $1,960