CHAPTER 10
Special and Combination Journals
and Voucher System
Ma. Rona Corda-Prado, CPA
University of St. La Salle
SUBSIDIARY LEDGERS
Subsidiary ledgers are a listing of individual
accounts with common characteristics.
Controlling
Characteristic Account Subsidary Ledger
Amounts due Accounts Accounts
from customers Receivable Receivable Ledger
Amounts owed to Accounts Accounts Payable
creditors Payable Ledger
Each general ledger control account balance must equal the
composite balance of the individual accounts in the related
subsidiary ledger.
Prepared by: RCPrado Chapter 10- 2
SUBSIDIARY LEDGERS
Advantages of Subsidiary Ledgers
1. Show in a single account transactions affecting one customer or
one creditor.
2. Free the general ledger of excessive details.
3. Help locate errors in individual accounts.
4. Make possible a division of labor.
5. Applies to accounts receivable, accounts payable, inventory and
PPE.
6. Subsidiary ledgers may simply be a group of accounts in a binder
or it may be a file card arrangement. Order is either numerical
by customer number or alphabetical by customer name.
Prepared by: RCPrado Chapter 10- 3
SUBSIDIARY LEDGERS
Review Question
All of the following are advantages of using
subsidiary ledgers except they:
a) show transactions affecting one customer or
one creditor in a single account.
b) free the general ledger of excessive details.
c) eliminate errors in individual accounts.
d) make possible a division of labor.
Prepared by: RCPrado Chapter 10- 4
SUBSIDIARY
Special LEDGERS
Journals in Accounting
Each of the following is a subsidiary ledger except:
a) accounts receivable ledger.
b) accounts payable ledger.
c) customer’s ledger.
d) general ledger.
Prepared by: RCPrado Chapter 10- 5
SUBSIDIARY LEDGERS
Prepared by: RCPrado Chapter 10- 6
SPECIAL JOURNALS IN ACCOUNTING
Cash Receipts
Sales Journal
Journal
All sales of All cash receipts
General Journal
merchandise on (including cash
account sales)
Transactions which could not
be recorded in the special
journals, including adjusting,
Cash correcting and closing entries
Purchases
Disbursements Journal
Journal
All cash paid All purchases of
(including cash merchandise on
purchases) account
Prepared by: RCPrado Chapter 10- 7
Information for each
sales is obtained from a
copy of the related sales
invoice.
Monthly
posting are
done to the
GL.
PR: S & page #
Amounts in the SJ are
posted daily to the
subsidiary ledger on a
daily basis.
Prepared by: RCPrado 8
Sales Journal
SALES JOURNAL
Under a perpetual inventory system, one entry at selling price in Sales
Journal results in a debit to Accounts Receivable and a credit to Sales.
Another entry at cost results in a debit to Cost of Goods Sold and a
credit
Prepared to Merchandise Inventory.
by: RCPrado Chapter 10- 9
SALES JOURNAL
Companies make daily postings
from the sales journal to the
individual accounts receivable in
the subsidiary ledger.
Prepared by: RCPrado Chapter 10- 10
SALES JOURNAL
Posting to the general ledger is
done monthly.
Prepared by: RCPrado Chapter 10- 11
SALES JOURNAL
Advantages of Sales Journal
One-line entry for each sales transaction saves
time.
Only totals, rather than individual entries, are
posted to the general ledger.
A division of labor results.
Prepared by: RCPrado Chapter 10- 12
CASH RECEIPTS JOURNAL
In the cash receipts journal, companies record all receipts of cash
(cash sale, collection and other sources of cash).
The posting of the cash receipts journal is similar to the posting of
the sale journal.
Prepared by: RCPrado Chapter 10- 13
Sourced from official
CASH RECEIPTS
receipts (OR), cash
Total debitsJOURNAL
register tapes (CRT), cash and credits
slips or credit memos before posting.
Post to GL
monthly.
Post to A/R SL
daily.
Reconcile SL total
to GL at the end of
the month.
Prepared by: RCPrado Chapter 10- 14
CASH RECEIPTS JOURNAL
Review Question
Cash sales of merchandise are recorded in the:
a) cash payments journal.
b) cash receipts journal.
c) general journal.
d) sales journal.
Prepared by: RCPrado Chapter 10- 15
CASH RECEIPTS JOURNAL
Review Question
Which of the following is not one of the credit
columns in the cash receipts journal:
a) Other accounts.
b) Accounts payable.
c) Accounts receivable.
d) Sales.
Prepared by: RCPrado Chapter 10- 16
PURCHASES
Sourced from JOURNAL - PERIODIC
Total debits &
credits and post
receiving reports
to GL monthly
Post to A/P
SL daily.
Prepared by: RCPrado Chapter 10- 17
PURCHASES JOURNAL - PERPETUAL
Daily postings are made from the
purchases journal to the accounts
payable subsidiary ledger.
Prepared by: RCPrado Chapter 10- 18
PURCHASES JOURNAL - PERPETUAL
Purchases Journal
At the end of the accounting
period, the company posts totals to
the general ledger.
Prepared by: RCPrado Chapter 10- 19
CASH PAYMENTS JOURNAL
In a cash payments (cash disbursements) journal, companies
record all disbursements of cash.
The procedures for posting the cash payments journal are similar to
thoseby:for
Prepared other journals.
RCPrado Chapter 10- 20
Sourced from
Cash Disbursements
CASH Journal
PAYMENTS JOURNAL
check vouchers.
Prepared by: RCPrado Chapter 10- 21
SPECIAL JOURNALS IN ACCOUNTING
Effects of Special Journals on the General Journal
Special journals substantially reduce the number of
entries that companies make in the general journal.
Only transactions that cannot be entered in a
special journal are recorded in the general journal.
Also, correcting, adjusting, and closing entries are
made in the general journal.
Prepared by: RCPrado Chapter 10- 22
SPECIAL JOURNALS SUMMARY
POSTING
JOURNAL SPECIFIC TRANSACTIONS RECORDED
ABBREVIATION
Sales Journal Sales of merchandise on account S
Cash Receipts Receipts of cash CR
Journal
Purchases Journal Credit purchases of merchandise and other P
items
Cash Payments of cashSales Journal CD
Disbursements
Journal
General Journal Entries that do not fit in the other journals GJ
• Merchandise Returns (Sales and
Purchases)
• Write-off of Uncollectible Accounts
• Non cash transactions (i.e.
Prepared by: RCPrado issuance/receipt of a promissory note) Chapter 10- 23
PROVING THE LEDGERS
At the end of the period, after all postings have
been made, equality should exist between the
following:
Total Dr = Total Cr in the G/L. These amounts
would be used to prepare the T/B.
AR Control (GL) Account = ∑ of Individual Customer
Accounts in the SL
AP Control (GL) Account = ∑ of Individual
Vendor/Creditor Accounts in the SL
Prepared by: RCPrado Chapter 10- 24
INTERNAL
CONTROL AND
THE VOUCHER SYSTEM
Section Objectives
1. Prepare vouchers.
2. Record vouchers in a voucher register.
3. Record payment of approved vouchers.
4. Record transactions that require special
treatment in a voucher system.
VOUCHER SYSTEM
Method of controlling liabilities and cash payments.
The voucher system is most appropriate for medium- and
large-sized companies.
All liabilities are authorized.
Checks may be drawn only upon a written authorization in
the form of a voucher approved by responsible officials.
Payments, except for small petty cash items, are made by
check.
Checks are issued based on properly approved vouchers.
Prepared by: RCPrado Chapter 10- 26
VOUCHER SYSTEM
Vouchers are used to set up and replenish cash funds.
Vouchers are used to cover bills and invoices received
from outside parties.
Consists of vouchers, vouchers register, unpaid voucher
file, check register and paid voucher file
Prepared by: RCPrado Chapter 10- 27
STEPS IN THE VOUCHER SYSTEM
1. Compare purchase requisition, purchase order, invoice,
and receiving report for agreement of quantities,
prices, types of goods and terms.
2. Verify receipt of merchandise.
3. Verify prices.
4. Verify computations.
5. Prepare and approve voucher.
6. Record and file the unpaid voucher according to due
date.
7. Pay the voucher.
8.Prepared
File by: the
RCPradopaid voucher. Chapter 10- 28
PAYMENT VOUCHER
Form used to authorize payments
Focal point in an effective internal control system.
The verified invoice is the basis for preparing a voucher.
After preparing the voucher, the verified invoice should
be attached to the voucher.
After comparing the invoice and the voucher, it is
approved for payment.
Prepared by: RCPrado Chapter 10- 29
VOUCHER REGISTER
A voucher register is a customized journal providing for
accounts used frequently.
Takes the place of the purchase journal and provides a
record of all authorized check payments
Vouchers Payable account maybe used in place of
Accounts Payable (but still recorded in the SFP as A/P)
All expenditures are recorded first in a voucher
register
Approved vouchers are entered in the register in
numerical sequence (Exhibit 10-5 pp 460)
Prepared by: RCPrado Chapter 10- 30
UNPAID VOUCHER FILE
After vouchers have been entered in the voucher
register, they are filed in the order of required date of
payment >>> to ensure timely payments and availment of
discounts
The absence of entries in the payment date and check
number columns of the voucher register indicate that
the voucher is unpaid.
Prepared by: RCPrado Chapter 10- 31
ISSUING CHECKS FOR VOUCHERS
Record entry in the check
register, debiting Accounts
Payable and crediting Cash .
Make notation in the voucher
register showing date paid and
check number.
In a voucher system, the check
register replaces the cash
payments journal. (Exhibit 10-5
pp 460)
Prepared by: RCPrado Chapter 10- 32
ISSUING CHECKS FOR VOUCHERS
Record entry in the check register, debiting
Accounts Payable and crediting Cash .
Make notation in the voucher register showing
date paid and check number.
In a voucher system, the check register replaces
the cash payments journal. (Exhibit 10-6 pp 460)
Prepared by: RCPrado Chapter 10- 33
PAID VOUCHER FILE
The paid voucher along with its
supporting documents are filed
in numerical sequence in a paid
voucher file
File is used for examination by
internal or external auditors
requiring information about a
specific expenditure
Prepared by: RCPrado Chapter 10- 34
SCHEDULE OF VOUCHERS PAYABLE
At the end of the month, a list of all unpaid
vouchers is prepared.
Compare the list to the unpaid vouchers in the
voucher register and the unpaid voucher file.
Ensure that the totals of the unpaid vouchers
in the voucher register and the unpaid voucher
file equals the balance of Accounts Payable .
Prepared by: RCPrado Chapter 10- 35
SCHEDULE OF VOUCHERS PAYABLE
CLASSIC CLOTHES, INC.
Schedule of Vouchers Payable
May 31, 2007
Voucher
Number Payable to Amount
4-29 Cotton Inc. $3,000.00
Should match
5-05
5-06
Southern Paper Company
P&S Office Products
225.00
75.00
balance in Accounts
5-07
5-08
Hank Hills, Attorney
Charles Alexander, CPAs
500.00
450.00
Payable account.
5-13 Big Insurance Company 500.00
5-17 Paper Box Company 195.00
5-18 Northside Utilities 35.00
5-19 Southern Gas 155.00
5-20 Gulf Shores Clothiers 7,800.00
5-21 ST & T Company 125.00
5-22 Truth in Publishing Company 950.00
5-23 On-Time Delivery 179.00
Total $14,189.00
TRANSACTIONS REQUIRING SPECIAL
TREATMENT
Partial payments.
Notes payable.
Purchases returns and allowances.
Purchases discounts lost.
Prepared by: RCPrado Chapter 10- 37
PARTIAL PAYMENT OF PREVIOUSLY
RECORDED VOUCHER
1. Cancel the original voucher.
2. Issue new vouchers for partial payments.
Prepared by: RCPrado Chapter 10- 38
PAYMENT OF NOTES PAYABLE
If a business issues a note payable for an unpaid
invoice, debit Accounts Payable and credit Notes
Payable—Trade.
In the voucher register, enter the date of the note
and enter the words ―By note‖ in the Check Number
column.
Prepared by: RCPrado Chapter 10- 39
PURCHASE RETURNS AND
ALLOWANCES
Method 1: Issue a new voucher and cancel the original
voucher. A notation about the new voucher is
made in the date paid column of the voucher
register beside the entry for the original
voucher. (Preferred – see Exhibit 10-7 pp
460)
Method 2: Make a notation for the allowance.
Prepared by: RCPrado Chapter 10- 40
RECORDING CASH DISCOUNTS
LOST
If purchase invoices are recorded in the voucher
register net of discount and an invoice is paid after
the discount period, the difference is recorded in the
check register by debiting Discounts Lost.
If Discounts Lost column is not available in the check
register, then lost discounts would be recorded in the
general journal.
Prepared by: RCPrado Chapter 10- 41
