Chapter 9 sec. 3

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Each entry in the purchases journal affects the account of the vendor named in the Account credited column. The amount on each line of a purchases journal is posted as a credit to a vendor account in the accounts payable ledger.

Posting frequently helps ensure that vendor accounts are paid on time.

When several journals are used an abbreviation is used to show from which journal the posting is made. P is used as an abbreviation for purchase journal. P11 means page eleven of the purchase journal. This additional information is necessary to provide a clear audit trial.

Posting from a Purchases Journal to an Accounts Payable Ledger

Write the date in the date column of the vendor account.

Write the journal page number in the Post. Ref. column of the account to provide an audit trial back to the journal where the transaction was recorded.

Write the camera amount in the Credit column of the vendor account.

Add the amount in the credit column to the previous balance in the Credit Balance column. Write the new account balance in the Credit Balance column.

Write the vendor number in the Post. Ref. column of the journal to provide an audit trial to the count where the transaction was posted.

Calculating the total does more than report the total value of inventory purchased on account during a period of time. Using the purchases journal the corp, can post all the purchase on a journal page to the genera; ledger using a single journal entry. In this way special journals significantly reduce the time required to post transactions.

Totaling and Ruling a Purchases Journal

Rule a single line across the amount column under the last entry.

Write the date in the date column

Write the word Total in the Account Credited column

Add the amount column. verify the total by re-reading the column in reverse order.

Write the total directly below the single line in the amount column.

Rule double lines across the amount column directly below the total amount to show that the total has been verified as correct.

The total amount of the purchases journal is posted to two general ledger accounts, Purchases and Accounts Payable. The debit to Purchases increases the balance of the account. The credit to Accounts Payable increases the balance of the account.

Posting the Total of a Purchases Journal to the General Ledger Accounts

Write the date in the date column of the accounts

Write the purchases journal number in the Post. Ref. columns of the accounts.

For each account write the purchases journal column total in the debit or credit column.

For each account, calculate and write the new account balance in the Balance Debit or Credit column.

Return to the purchases journal and write the Purchases general ledger account number and the Accounts Payable general ledger account number in parentheses below the column total.