1. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 3-1 Journals, Source Documents, and Recording Entries in a Journal Slides are on the class website!

2. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 2 LESSON 3-1 A GENERAL JOURNAL page 57 Does anything resemble a T Account?

3. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning JOURNALIZING TRANSACTIONS 3 LESSON 3-1 The purpose of journalizing a transaction is to keep a record of a business’s financial activities. If we did not journalize transactions, how could we possibly keep track of a business’s financial activities? Just like analyzing transactions and recording their debit and credit components in T accounts, in journalizing transactions the same steps are performed.

4. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning JOURNALIZING TRANSACTIONS 4 LESSON 3-1 Steps in Analyzing a Transaction 1.Identify which accounts are affected (cash, sales, supplies, etc) 2.Determine how each account is classified (Asset, Liability, or Owner’s Equity) 3.Decide how each classification is changed (what will increase or decrease) 4.Evaluate how each amount of the transaction is recorded (what amount is being debited or credited)

5. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning JOURNALIZING TRANSACTIONS 5 LESSON 3-1 Where does the information about transactions come from? Paid cash for supplies $275.00.

6. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 6 LESSON 3-1 BUSINESS RECORDS – Source Documents page 58

7. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 7 LESSON 3-1 SALES INVOICES page 58

8. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 8 LESSON 3-1 OTHER SOURCE DOCUMENTS page 59 memorandum calculator tape receipt

9. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning JOURNALIZING TRANSACTIONS 9 LESSON 3-1 Steps in properly journalizing a transaction in the General Journal: 1.Analyze the transaction to determine the accounts that will be debited and credited (hint use T accounts). 2.Record the date of the transaction. 3.Record the name of the account to be debited and the debit amount (remember to align the account title to the left for all debits). 4.Record the name of the account to be credited and the credit amount (remember to indent the account title to the right). 5.Record the source document number in the Doc. No. column.

10. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 10 LESSON 3-1 PAID CASH FOR SUPPLIES page 61 August 3. Paid cash for supplies, $275.00. Check No. 1. 1 4 22 1.Write the date in the Date column. 4.Write the source document number in the Doc. No. column. 3.Write the title of the account credited. Write the credit amount. 2.Write the title of the account debited. Write the debit amount. 33