1
ACCOUNTING CYCLE FOR A MERCHANDISING
BUSINESS ORGANIZED AS A CORPORATION
1
2
3
4
5
(continued on next slide)
page 497
1. Source documents are checked,
and transactions are analyzed.
2. Transactions are recorded in
journals.
3. Journal entries are posted to the
accounts payable ledger, the
accounts receivable ledger, and
the general ledger.
4. Schedules of accounts payable
and account receivable are
prepared from the subsidiary
ledgers.
5. A work sheet is prepared from the
general ledger.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 14-6
2
ACCOUNTING CYCLE FOR A MERCHANDISING
BUSINESS ORGANIZED AS A CORPORATION
page 497
6. Financial statements are prepared.
7. Adjusting and closing entries are
journalized from the work sheet.
8. Adjusting and closing entries are
posted to the general ledger.
9. A post-closing trial balance of the
general ledger is prepared.
9
8
7
6
(continued from previous slide)
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 14-6
LESSON 11-1
 Subsidiary ledger
 A ledger that is summarized in a single general ledger account
 Accounts Payable ledger
 Subsidiary ledger containing only accounts for vendors from whom
merchandise or other items are purchased on account
 Accounts Receivable ledger
 Subsidiary ledger containing only accounts for charge customers
 Controlling account
 General ledger account that summarizes all accounts in a subsidiary
ledger
 Accounts Payable and Accounts Receivable
 Balance of controlling account equals the total of all account balances
in its related subsidiary ledger
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
4
ACCOUNTS PAYABLE LEDGER AND GENERAL
LEDGER CONTROLLING ACCOUNT
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
page 299
LESSON 11-1
5
ACCOUNTS PAYABLE LEDGER FORMS
1
3
1.
2.
3.
4.
5.
6.
4
page 300
2
5
6
Write the vendor name.
Write the vendor number.
Write the date.
Write the word Balance.
Place a check mark in the Post. Ref. column.
Write the balance.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 11-1
6
POSTING FROM A PURCHASES JOURNAL
page 301
TO AN ACCOUNTS PAYABLE LEDGER
2
1
5
3
1. Write the date.
2. Write the journal page number.
3. Write the credit amount.
4
4. Write the new account balance.
5. Write the vendor number.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 11-1
7
POSTING FROM A CASH PAYMENTS JOURNAL
TO AN ACCOUNTS PAYABLE LEDGER
page 302
5
1
2
3
1. Write the date.
2. Write the journal
page number.
3. Write the debit
4
amount.
4. Subtract the amount in the Debit column from the previous balance in
the Credit column. Write the new balance.
5. Write the vendor number.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 11-1
POSTING A CREDIT ENTRY FROM A
GENERAL JOURNAL TO AN ACCOUNTS
PAYABLE LEDGER
1
8
page 303
3
2
5
4
1. Write the date.
2. Write the general journal
page number.
3. Write the amount.
4. Add the amount in the Credit column to
the previous balance in the Credit
Balance column. Write the new balance.
5. Write the vendor number.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 11-1
POSTING A DEBIT ENTRY FROM A
GENERAL JOURNAL TO AN ACCOUNTS
PAYABLE LEDGER
1
2
9
page 303
5
3
4
1. Write the date.
2. Write the general journal
page number.
3. Write the amount.
4. Add the amount in the Debit column to
the previous balance in the Debit
Balance column. Write the new balance.
5. Write the vendor number.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 11-1
10
COMPLETED ACCOUNTS PAYABLE
LEDGER
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
page 304
LESSON 11-1
11
PROVING THE ACCOUNTS PAYABLE
LEDGER
page 305
 Schedule of Accounts Payable – listing of vendor accounts, account
balances, and total amount due all vendors
 Prepared after all entries in a journal are posted
 Total must match the balances of Accounts Payable in the general ledger
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 11-1
12
TERMS REVIEW





page 306
subsidiary ledger
accounts payable ledger
accounts receivable ledger
controlling account
schedule of accounts payable
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 11-1
LESSON 11-2
Posting to an Accounts
Receivable Ledger
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
14
ACCOUNTS RECEIVABLE LEDGER AND
GENERAL LEDGER CONTROLLING ACCOUNT
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
page 307
LESSON 11-2
15
ACCOUNTS RECEIVABLE LEDGER
FORMS
1
Customer name
2
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
page 308
Customer number
LESSON 11-2
16
POSTING FROM A SALES JOURNAL TO AN
page 309
ACCOUNTS RECEIVABLE LEDGER
2
1
5
3
4
4. Add the amount in the Debit column to the
1. Write the date.
previous balance in the Debit Balance
2. Write the sales journal
column. Write the new account balance.
page number.
3. Write the debit amount. 5. Write the customer number.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 11-2
17
POSTING FROM A CASH RECEIPTS JOURNAL
TO AN ACCOUNTS RECEIVABLE LEDGER
page 310
5
1. Write the date.
3
2. Write the cash 1
receipts journal
page number.
3. Write the credit
2
amount.
4
4. Subtract the amount in the Credit column from the previous
balance in the Debit Balance column. Write the new balance.
5. Write the customer number.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 11-2
POSTING A CREDIT ENTRY FROM A GENERAL
JOURNAL TO AN ACCOUNTS RECEIVABLE
LEDGER
1
2
3
5
4
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
18
page 311
1. Write the date.
2. Write the general
journal page
number.
3. Write the amount.
4. Subtract the
amount in the
Credit column
from the previous
balance in the
Debit Balance
column. Write the
new balance.
5. Write the
customer number.
LESSON 11-2
19
COMPLETED ACCOUNTS RECEIVABLE
LEDGER
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
page 312
LESSON 11-2
20
PROVING THE ACCOUNTS RECEIVABLE
LEDGER
page 313
 Schedule of accounts receivable – listing of customer
accounts, account balances, and total amount due from all
customers (total matches balance in Accounts Receivable)
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 11-2
21
TERM REVIEW
page 314
 schedule of accounts receivable
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 11-2
LESSON 11-3
Posting from Journals to a
General Ledger
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
23
STARTING A NEW PAGE FOR AN
ACCOUNT IN A GENERAL LEDGER
1
3
4
page 315
2
5
6
1. Write the account title.
2. Write the account number.
3. Write the date.
4. Write the word Balance in the Item column.
5. Place a check mark in the Post. Ref. column.
6. Write the balance.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 11-3
24
POSTING FROM THE GENERAL AMOUNT
COLUMNS OF A CASH PAYMENTS JOURNAL
TO A GENERAL LEDGER
3
1
page 316
2
5
1. Write the date.
2. Write the journal
page number.
3. Write the debit
4
amount.
4. Add the amount in the Debit column to the previous balance in the
Balance Debit column. Write the new balance.
5. Write the general ledger account number.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 11-3
25
POSTING A DEBIT ENTRY FROM A GENERAL
JOURNAL TO A GENERAL LEDGER
1
5
2
3
4
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
page 317
1. Write the date.
2. Write the
general journal
page number.
3. Write the
amount.
4. Calculate and
write the new
account
balance.
5. Write the
general ledger
account number.
LESSON 11-3
26
POSTING A CREDIT ENTRY FROM A GENERAL
JOURNAL TO A GENERAL LEDGER
1
2
5
3
4
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
page 318
1. Write the date.
2. Write the
general journal
page number.
3. Write the
amount.
4. Calculate and
write the new
account
balance.
5. Write the
general ledger
account number.
LESSON 11-3
LESSON 11-4
Posting Special Journal
Totals to a General Ledger
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
28
POSTING TOTALS OF A SALES JOURNAL
page 320
TO A GENERAL LEDGER
1
2
3
5
4
5
1
2
3
4
5
1
2
3
1. Write the date.
2. Write the sales journal
page number.
3. For each column and
account, write the
column total.
4. For each account,
calculate and write the
new account balance.
5. In the sales journal,
write the general ledger
account number.
4
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 11-4
29
POSTING THE TOTAL OF A PURCHASES
JOURNAL TO A GENERAL LEDGER
1
2
3
4
1
2
3
4
page 321
1. Write the date.
2. Write the purchases
journal page number.
3. For each account,
write the purchases
journal column total.
5
4. For each account,
calculate and write
the new balance.
5. Write the purchases
general ledger
5
account number and
the accounts payable
general ledger
account number.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 11-4
POSTING SPECIAL AMOUNT COLUMN TOTALS
OF A CASH RECEIPTS JOURNAL TO A
GENERAL LEDGER
1
2
5
3
5
5
5
30
page 322
1. Date
2. Journal page
number
3. Column total
4. Account balance
5. Account number
5
4
1
2
3
4
1
1
2
3
4
2
1
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
3
2
4
3
4
LESSON 11-4
POSTING SPECIAL AMOUNT COLUMN TOTALS
OF A CASH PAYMENTS JOURNAL TO A
GENERAL LEDGER
2
1
5
1
3
2
3
5
1.
2.
3.
4.
5.
4
2
page 324
5
3
1
31
4
Date
Journal page number
Column total
Account balance
Account number
4
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 11-4
32
ORDER OF POSTING FROM SPECIAL
JOURNALS
 Items affecting customer or vendor accounts are posted
periodically during the month
 Keeps subsidiary ledger balances up to date
 General ledger accounts are posted less often because they
are only needed when financial statements are prepared
 Special amount columns are posted monthly in the following
order:
1.
2.
3.
4.
5.
Sales journal
Purchases journal
General journal
Cash receipts journal
Cash payments journal
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 11-1
LESSON 11-5
 Correcting Errors in Subsidiary Ledger Accounts
December 10. Discovered that a sale on account to Cumberland
Center on December 3 was incorrectly charged to the account of
Country Crafters, $412.00. Memorandum No. 56.
Accounts Rec.
12/3
412.00
Country Crafters
12/3
412.00
12/10 412.00
Cumberland
Center
12/10 412.00
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
Sales
12/3
412.00
34
JOURNALIZING CORRECTING ENTRIES
AFFECTING CUSTOMER ACCOUNTS
page 327
December 10. Discovered that a sale on account to Cumberland
Center on December 3 was incorrectly charged to the account of
Country Crafters, $412.00. Memorandum No. 56.
2
4
1
5
1.
2.
3.
4.
Write the date.
Write the name of correct customer.
Write the memorandum number.
Write the amount.
3
6
5. Write the name of incorrectly
charged customer.
6. Write the amount.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 11-5
35
POSTING CORRECTING ENTRIES
AFFECTING CUSTOMER ACCOUNTS
page 328
1
5
2
3
4
1
2
3
5
4
1. Write the date.
2. Write the general
journal page number.
3. Write the amount.
4. Calculate and write the
new account balances.
5. Write the appropriate
customer number in the
Post. Ref. columns.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 11-5