FUNDAMENTALS OF ACCOUNTACY,
BUSINESS AND MANAGEMENT 2
TOPIC: JOURNALIZING PROCESS
SUBJECT TEACHER: JANZHEL LIMOS
At the end of the lesson the student shall be able to:
• Define what is a general journal
• Explain the steps in journalizing
• Prepare journal entries
1
8 2
ACCOUNTING
7 PROCESS 3
6 4
5
2 Recording in the journal
book
The Journalizing
Process
is the process of entering a transaction in
a journal. Journal is a chronological
record, that is arranged according to time
of occurrence, of business transactions.
It is called the book of original entry
since it is where the transactions are first
recorded.
The journal is composed of the following columns:
May 1 – Atty. Felicitas O. Otanes, a lawyer opened the Otanes Law Firm on
May 1, 2014, with a cash investment of P 250, 000 and supplies
worth P 50, 000.
GENERAL JOURNAL Page 1
Date Description PR Debit Credit
2014
May
1 Cash 101 250 000 -
Supplies 103 50 000 -
F. Otanes, Capital 301 300 000 -
To record the cash and supplies
investment of the owner.
Description Debit Column
Column
Posting Reference
Date Column Credit Column
Column
Chart of Accounts
is a list of assets, liabilities, capital, revenue and expenses
applicable to the business enterprise. It includes the account titles
and their corresponding account numbers. The account titles are
arranged as follows:
a. Assets – wherein account numbers usually starts with 1;
b. Liabilities – wherein account numbers usually starts with 2;
c. Capital – wherein account numbers usually starts with 3;
d. Revenue – wherein account numbers usually starts with 4; and,
e. Expenses – wherein account numbers usually starts with 5.
OTANES LAW FIRM CHART OF ACCOUNTS
Assets Account Numbers
Cash 101
Accounts Receivable 102
Supplies 103
Prepaid Insurance 104
Equipment 105
Accumulated Depreciation - Equipment 106
Prepaid Taxes 107
Liabilities
Accounts Payable 201
Notes Payable 202
Salaries Payable 203
Unearned Professional Fees 204
OTANES LAW FIRM CHART OF ACCOUNTS
Capital Account Numbers
F. Otanes, Capital 301
F. Otanes, Drawing 302
Income Summary 303
Revenue
Professional Fees 401
Expense
Salaries Expense 501
Rent Expense 502
Utilities Expense 503
Supplies Expense 504
Advertising Expense 505
Miscellaneous Expense 506
Taxes Expense 507
Insurance Expense 508
Depreciation Expense - Equipment 509
Observe the following:
GENERAL JOURNAL Page 1
Date Description PR Debit Credit
2014 Cash 101 250 000 -
May
1
Supplies 103 50 000 -
F. Otanes, Capital 301 300 000 -
Cash and supplies investment
by the owner.
1 3
The name of the book, General Journal, is written Peso sign, comma, and decimal point are
at the upper portion of every page. A page not used in columnar sheets. A dash is
number is also written on each sheet of journal. placed when there are no centavos
involved
2 Usually the first entry is called a compound
journal entry.
4 Always leave one space after each journal
entry.
GENERAL JOURNAL Page 1
Date Description PR Debit Credit
J.C. MEN’S WEAR SHOP CHART OF ACCOUNTS
ASSETS
111 Cash
112 Accounts Receivable – Flor Valdez
113 Accounts Receivable – Julius Ilagan
113a Allowance for Bad Debts
114 Sewing Supplies
115 Clothing Materials
116 Prepaid Rent
117 Prepaid Insurance
118 Sewing Tools
119 Sewing Equipment
119a Accumulated Depreciation – sewing equipment
LIABILITIES
211 Accounts Payable – Virgilio Trading
212 Accounts Payable – Rufino Merchandising
213 Notes Payable
214 Accrued Interest Expense
J.C. MEN’S WEAR SHOP CHART OF ACCOUNTS
OWNER’S EQUITY
311 J.Cacdac, capital
312 J.Cacdac, drawing
REVENUE
411 Service Revenue
EXPENSES
511 Wages Expense
512 Utility Expense
513 Insurance Expense
514 Sewing Supplies Expense
515 Clothing Materials Expense
516 Rent Expense
517 Interest Expense
518 Depreciation expense – sewing equipment
519 Bad Debts Expense
On December 1, 2020 Josie Cacdac opened the “J.C. Men’s Wear Shop”, and during
the month, the following transactions were completed.
Dec. 1 - Josie Cacdac invested P 8, 000 cash in the business
GENERAL JOURNAL Page 1
Date Description PR Debit Credit
2020
1 Cash 111 8 000 -
Dec
J. Cacdac, Capital 311 8 000 -
To record the initial investment
of J. Cacdac
Dec 1 - She bought two sewing machines worth P 3, 000 each from Rufino
Merchandising. Gave P 1, 500 down and the balance is payable within 60 days.
GENERAL JOURNAL Page 1
Date Description PR Debit Credit
Sewing Equipment 119 6 000 -
Cash 111 1 500 -
Accounts Payable - Rufino Mdsg. 212 4 500 -
Sewing machines bought,
terms: 1,500 down, bal. payable
within 60 days.
Dec 1 - Paid a three-month rental of the shop, P 3, 000. This was
charged to Prepaid Rent account
GENERAL JOURNAL Page 1
Date Description PR Debit Credit
Prepaid Rent 116 3 000 -
Cash 111 3 000 -
Payment of the shop space
rental for the months of Dec.,
Jan., February.
Dec 1 - Paid a one-year insurance policy, P 570. (Use expense method).
GENERAL JOURNAL Page 1
Date Description PR Debit Credit
Insurance Expense 513 570 -
Cash 111 570 -
Payment of a one year-insurance
policy.
Dec 3 - Bought sewing tools P 590 and sewing supplies P 270 from
Virgilio Trading on credit
GENERAL JOURNAL Page 1
Date Description PR Debit Credit
3 Sewing Tools 118 590 -
Sewing Supplies 114 270 -
Accounts Payable – Virgilio Trading 211 860 -
Purchase of tools and supplies
on credit.
Dec 5 - Received P 120 from a customer for a terno delivered
GENERAL JOURNAL Page 1
Date Description PR Debit Credit
5 Cash 111 120 -
Service Revenue 411 120 -
Cash received from a terno
delivered.
Dec 7 - Billed Flor Valdez, P 500 for a two-pair of pants and polo
barong delivered.
GENERAL JOURNAL Page 1
Date Description PR Debit Credit
7 Accounts Receivable – Flor Valdez 112 500 -
Service Revenue 411 500 -
Services rendered on credit
Dec 10 - Purchased clothing materials from Divisoria Market and paid
P 1, 500 cash.
GENERAL JOURNAL Page 1
Date Description PR Debit Credit
10 Clothing Materials 115 1 500 -
Cash 111 1 500 -
Services rendered on credit
Dec 13 - Received P 1, 250 from various customers for pants and
barong made and delivered.
GENERAL JOURNAL Page 2
Date Description PR Debit Credit
13 Cash 111 1 250 -
Service Revenue 411 1 250 -
Cash received from various
customers.
Dec 14 - Gave Rufino Merchandising P 1, 500 and issued a 60-day, 6%
note for the balance.
GENERAL JOURNAL Page 2
Date Description PR Debit Credit
14 Accounts Payable - Rufino Mdsg. 212 4, 500 -
Cash 111 1 500 -
Notes Payable 213 3 000 -
Settlement of the account due
to Rufino Merchandising
Dec 15 - Paid the wages of the shop helper, P 250.
GENERAL JOURNAL Page 2
Date Description PR Debit Credit
15 Wages Expense 511 250 -
Cash 111 250 -
Wages of the shop helper for
first half of the month.
Dec 17 - Josie Cacdac withdrew P 500 from the business for personal
use.
GENERAL JOURNAL Page 2
Date Description PR Debit Credit
17 J. Cacdac, drawing 312 500 -
Cash 111 500 -
Drawing of the owner for
personal use .
Dec 18 - F. Valdez gave P200 as partial payment of his account
GENERAL JOURNAL Page 2
Date Description PR Debit Credit
18 Cash 111 200 -
Accounts Receivable – Flor Valdez 112 200 -
Partial payment of Flor Valdez
Dec 20 - Received P 1, 475 from various customers for pants and shirts
delivered.
GENERAL JOURNAL Page 2
Date Description PR Debit Credit
20 Cash 111 1 475 -
Service Revenue 411 1 475 -
Cash received from customers
Dec 22 - Paid the wages of the shop helper, P 250.
GENERAL JOURNAL Page 2
Date Description PR Debit Credit
22 Wages Expense 511 250 -
Cash 111 250 -
Wages of the shop helper for
second half of the month.
Dec 23 - Billed Julius Ilagan P 400 for barong and pants delivered to
him.
GENERAL JOURNAL Page 2
Date Description PR Debit Credit
23 Accounts Receivable – Julius Ilagan 113 400 -
Service Revenue 411 400 -
Services rendered on account
Dec 27 - Paid the following monthly expenses: utility bills, P 150;
telephone bill, P 250.
GENERAL JOURNAL Page 2
Date Description PR Debit Credit
27 Utility Expense 512 400 -
Cash 111 400 -
Payment of monthly utility
bills
REFERENCES
Aliling L. E. (2019). Fundamentals of Basic Accountancy, First Edition, Manila, Philippines: Rex
Bookstore.
Arganda, et al (2012) Accounting Principles 1, Fourth Edition, Mandaluyong City, Philippines: National
Book Store
