This document provides instructions for journalizing transactions for G. Alajar's new television repair shop called "Sure Repair Shop". It lists transactions that occurred during the shop's first month of operations in September 2017. Students are asked to determine the account titles involved in each transaction, apply debit and credit rules to journalize the transactions, and provide explanations for the journal entries. The performance criteria checklist is also provided to check that journal entries were prepared correctly.
This document provides instructions for journalizing transactions for G. Alajar's new television repair shop called "Sure Repair Shop". It lists transactions that occurred during the shop's first month of operations in September 2017. Students are asked to determine the account titles involved in each transaction, apply debit and credit rules to journalize the transactions, and provide explanations for the journal entries. The performance criteria checklist is also provided to check that journal entries were prepared correctly.
This document provides instructions for journalizing transactions for G. Alajar's new television repair shop called "Sure Repair Shop". It lists transactions that occurred during the shop's first month of operations in September 2017. Students are asked to determine the account titles involved in each transaction, apply debit and credit rules to journalize the transactions, and provide explanations for the journal entries. The performance criteria checklist is also provided to check that journal entries were prepared correctly.
This document provides instructions for journalizing transactions for G. Alajar's new television repair shop called "Sure Repair Shop". It lists transactions that occurred during the shop's first month of operations in September 2017. Students are asked to determine the account titles involved in each transaction, apply debit and credit rules to journalize the transactions, and provide explanations for the journal entries. The performance criteria checklist is also provided to check that journal entries were prepared correctly.
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JOB SHEET No. 1.
3-1 Title: Prepare Journal Entry Given one Learning Outcome on Preparing Performance Objective: Journal Entry, you should be able to journalize transactions. Calculator Paper Supplies and Materials: General Journal Pencil Eraser 1. Based on first month’s operation of Mr. G. Alajar (refer to transactions below) determine the titles of the accounts involved.
2. Apply the rule of debit and credit. Steps and Procedure: 3. Supply an explanation of each transaction whenever necessary.
4. Make the necessary journal entry for each transaction. Written test Assessment Method: Practical/performance test Interview JOURNALIZE TRANSACTIONS
G. Alajar recently established his own business, which he called "Sure
Repair Shop". During the first month of the business in Sept 2017, the following transactions were completed.
2017 Sept. 1 G. Alajar opened a television repair shop he called "Sure Repair Shop". He began business by investing P2,500.00 in cash and the following assets: repair tools P1200; repair supplies P1500 and a truck P20,000.00. 2 Paid P250.00 for newspaper advertising announcing the opening of his shop. 3 Purchased office tables and chairs and filing cabinets from Cruz Furniture on credit, 6500. 5 Completed repair work for R. Gil on credit, P1200.00. 9 Completed repair work for M. Soriano, P2,200.00. Accepted P1000.00 in cash and promised to pay the balance after five days. 15 Paid the wages of the shop helper, P450.00 18 Paid one-half of the account due to Cruz Furniture and issued a promissory note for the other half. 20 R. Gil paid his account. 25 Withdrew cash for P750.00 for personal use. 28 Received P2500.00 from S. Serna for repair service rendered. 30 Paid the monthly utility bill, P150.00 30 Paid the month's rent of the shop, P1000.00 30 Wages of the shop helper, P450.00
Required: Journalize the above transactions.
PERFORMANCE CRITERIA CHECKLIST NO.1.3-1
Did you…. YES NO
-prepare journals in accordance with industry practice and generally accepted accounting principles/Philippine Financial Reporting Standards for transactions and events. -determine debit account titles in accordance with chart o accounts. -determine credit account titles in accordance with chart of accounts -prepare explanation to journal entry in accordance with the nature of transaction.
A Journal entry is the first step of the accounting or book-keeping process. In this step, all the accounting transactions are recorded in general journal in a chronological order. The general journal is maintained essentially on the concept of double entry system of accounting, where each transaction affects at least two accounts.
Other names used for general journal are “journal book” and “book of original entry”. The process of making a journal entry
The first step in the process of preparing a journal entry is to analyze the accounts involved in a business transaction and then apply the rules of debit and credit based on the type of each account. After identifying the accounts involved in the transaction and deciding upon the applicable rules, the journal entry is recorded in the general journal in a specified format which includes the following details:
1. Date of transaction 2. Ledger accounts involved 3. Amount of transaction 4. A brief narration to describe the transaction Format of general journal
Let’s understand the format of general journal and the process of making a journal entry through an illustration.
Transaction:
January 05: Purchase of machinery by making cash payment of $15,000.
Analysis of transaction:
Recording journal entry:
According to rules of debit and credit, when an asset increases, its account is debited and when an asset decreases, its account is credited. In this transaction, machinery (an asset) is increasing, and cash (an asset) is decreasing. So the journal entry would be made as follows:
All business transactions are recorded in the general journal in a manner illustrated above. After making journal entries in the journal, they are periodically posted to the ledger accounts.
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Example:
The Moon Service Inc. engaged in the following transactions during the month of November 2015:
Nov. 01: Issued 20,000 shares of common stock at $20 per share Nov. 03: Paid office rent for the moth of November $500. Nov. 06: Purchased office supplies $250. Nov. 12: Purchased office equipment on account $4,500 Nov. 16: Purchased business car for $25,000. Paid $10,000 cash and issued a note for the balance. Nov. 21: Billed clients $24,000 on account. Nov. 25: Declared dividends $3,000. The amount of dividends will be distributed in December. Nov. 28: Paid utility bills for the month of November $180. Nov. 29: Received $20,000 cash from clients billed on November 21. Nov. 30: Paid salary for the month of November $7,500
Required: Record the above transactions in a general journal.
quired: Record the above transactions in a general journal.
Solution: ADVERTISEMENT
The use of software packages for journalizing:
These days most of the companies use some form of software package that automates many tasks involved in journalizing their business transactions. A basic understanding of manual procedure to record transactions in a general journal is, however, necessary to know how software packages perform their function.
Click on the next link below to see how ledger accounts of Moon Service Inc. will be prepared.
