Chapter 11 Review 11.1- Subsidiary Ledger Systems 11.2- The Synoptic Ledger 11.2- The five Journal System (NEW)

Chapter 11 Review

11.1- Subsidiary Ledger Systems11.2- The Synoptic Ledger11.2- The five Journal System (NEW)

11.1 – Subsidiary Ledger System

What is it? Is a separate ledger that contains a number of

accounts of a similar type, such as accounts receivable

The accounts in a subsidiary ledger make up the detailed data for one related CONTROL ACCOUNT (general ledger account related to a subsidiary ledger, example of Control Account: Accounts Receivable)

Refer to exercise #2 pg. 518 (t), pg. 384-385 (w)

11.2 – The Synoptic Journal

What is it? Takes everyday, routine transactions and enters into a

“specialized” journal that sorts items during the journalizing process.

Synoptic Journal has a number of columns to accumulate accounting entries

Saves time when posting. Only the totals of special columns are posted, therefore, only one posting for each account

Be sure to balance the Synoptic Journal (cross-balancing: grand total of all debit columns against grand total of all credit columns)

Refer to Exercise #2 pg. 537-539 (t), pg. 400-402 (w)

11.2 FIVE JOURNAL ACCOUNTING SYSTEM

-correcting entries

FIVE JOURNALS

SOURCE DOCUMENTS: REFER TO OVERHEAD

Cash Sales SlipsCash ReceiptsBank CR Memos

Sales InvoicesCredit Invoices issued

Purchase InvoicesCredit Invoices received

Cheque CopiesBank DR Memos

Other Source Documents(non-routine entries—adjusting/closing entries)

ALL FIVE JOURNALS ARE POSTED TO:

Cash Receipts Journal (C.R.J)

Bank DREx p. 497 (t)

Sales Journal (S.J)Ex. P. 497 (t)

Purchase Journal(P.J) p. 498 (t)

Cash Payment Journal (C.P.J)Ex. p. 498 (t)

General Journal(G.J)

A/RLedger

A/P Ledger

GeneralLedger

Pay liabilitiesPay expenseDrawingsBuy assets

11.2 – Exercise #4 pg. 502-503 (t), pg. 405 (w)

Question: In which of the five journals would each transaction below be recorded?

TRANSACTIONS:

a. A cheque is issued to a supplier on account Cheque Copy Cash Payment

b. A purchase invoice is received from a supplier of merchandise

Purchase Invoice Purchase Journal

c. A cheque is received on account from a customer Cash Receipts Cash Receipts Journal

Let’s Try It!

Complete Exercise #3 & 4 p. 502-503 (t), p. 405 (w)

Complete Exercise # 5 p. 530-532 (t), p. 443-452 (t)

A) Post the subsidiary ledgers on a daily basis directly from the source documents

B) Balance and rule each of the five journals

C) Hand-in when done – you will have more time tomorrow to work on it.

d. A cash sale is made to a customer Cash Sales Slip Cash Receipts Journal

e. A sale on account is made to a customer Sales Invoice Sales Journal

f. A cheque is issued to the owner for his personal use

Cheque Copy Cash Payment Journal

g. A cheque is issued to pay for wages for the period


h. A sales invoice is used Sales invoice Sales Journal (A/R Ledger)

i. A correcting entry is made to transfer a debit amount from the Supplies account to the Miscellaneous Expense account

Other Source Documents General Journal

j. A cheque is issued to pay for a cash purchase of merchandise.


k. A bank debit advice for a service charge is received

Bank Debit Memo Cash Payment Journal

l. A cheque is issued to a supplier on account Cheque Copy Cash Payment Journal

m. A cheque is issued to pay for monthly rent Cheque Copy Cash Payment Journal

n. A bank debit advice is received with respect to a bad cheque

Bank Debit Memo Cash Payments Journal

o. A bank credit advice is received with respect to interest earned.

Bank Credit Memo Cash Receipts Journal

p. A new typewriter is purchased and a down payment is required. A cheque is issued.


q. The owner collects a debt from a customer but keeps the money for his personal use

Withdrawal General Journal, Cash Receipt Cash Receipt Journal

r. The owner spends a sum of money out of his own pocket for a business purpose and is reimbursed by means of a cheque.

Cheque Copy Cash Payments Journal