Century 21 Accounting, 8e

Century 21 Accounting, 9e

Multicolumn Journal

Chapter Outlines

PART 1ACCOUNTING FOR A SERVICE BUSINESS ORGANIZED AS A PROPRIETORSHIP

Chapter 1Starting A Proprietorship: Changes that Affect the Accounting Equation

The Accounting Equation

What Is Accounting?

The BusinessTechKnow Consulting

The Accounting Equation

How Business Activities Change the Accounting Equation

Receiving Cash

Received Cash from Owner as an Investment

Paying Cash

Paid Cash for Supplies

Paid Cash for Insurance

Transactions on Account

Bought Supplies on Account

Paid Cash on Account

How Transactions Change Owners Equity in an Accounting Equation

Revenue Transactions

Received Cash from Sales

Sold Services on Account

Expense Transactions

Paid Cash for Rent

Paid Cash for Telephone Bill

Other Cash Transactions

Received Cash on Account

Paid Cash to Owner for Personal Use

Summary of Changes in Owners Equity

Chapter 2Analyzing Transactions into Debit and Credit Parts

Using T Accounts

Analyzing the Accounting Equation

Accounts

Account Balances

Increases and Decreases in Accounts

Analyzing How Transactions Affect AccountsReceived Cash from Owner as an Investment

Paid Cash for Supplies

Paid Cash for Insurance

Bought Supplies on Account

Paid Cash on AccountAnalyzing How Transactions Affect Owners Equity Accounts

Received Cash from Sales

Sold Services on Account

Paid Cash for an Expense

Received Cash on Account

Paid Cash to Owner for Personal Use

Chapter 3Journalizing Transactions

Journals, Source Documents, and Recording Entries in a Journal

Journals and Journalizing

A Five-Column Journal

Using a Journal

Accuracy

Chronological Record

Double-Entry Accounting

Source Documents

Checks

Sales Invoices

Other Source Documents

Receipts

Memorandums

Calculator Tapes

Received Cash from Owner as an Investment

Paid Cash for Supplies

Journalizing Buying Insurance, Buying on Account, and Paying on Account

Paid Cash for Insurance

Bought Supplies on Account

Paid Cash on Account

Journalizing Transactions that Affect Owners Equity and Receiving Cash on Account

Received Cash from Sales

Sold Services on Account

Paid Cash for an Expense

Received Cash on Account

Paid Cash to Owner for Personal Use

Proving and Ruling a Journal

Proving a Journal Page

Ruling a Journal Page

Starting a New Journal Page

Proving and Ruling a Journal at the End of a Month

Proving Cash

Ruling a Journal at the End of a Month

Standard Accounting Practices

Chapter 4Posting to a General Ledger

Preparing a Chart of Accounts

Account Form

Relationship of a T Account to an Account Form

Chart of Accounts

Preparing a Chart of Accounts

Account Numbers

Assigning Account Numbers

Opening an Account in a General Ledger

Posting Separate Amounts from a Journal to a General Ledger

Posting an Amount from a General Debit Column

Posting a Separate Amount from a General Debit Column

Posting a Second Amount to an Account

Posting an Amount from a General Credit Column

Posting Column Totals from a Journal to a General Ledger

Check Marks Show that Amounts Are Not Posted

Journal Entries that Are Not Posted Individually

Totals of General Debit and General Credit Amount Columns

Posting the Total of the Sales Credit Column

Posting the Total of the Cash Debit Column

Posting the Total of the Cash Credit Column

Completed Accounting Forms and Making Correcting Entries

Journal Page with Posting Completed

General Ledger with Posting Completed

Memorandum for a Correcting Entry

Journal Entry to Record a Correcting Entry

Chapter 5Cash Control Systems

Checking Accounts

How Businesses Use Cash

Depositing Cash

Deposit Recorded on a Check Stub

Blank Endorsement, Special Endorsement, and Restrictive Endorsement

Blank Endorsement

Special Endorsement

Restrictive Endorsement

Completed Check Stub and Check

Recording a Voided Check

Bank Reconciliation

Bank Statement

Bank Statement Reconciliation

Recording a Bank Service Charge on a Check Stub

Journalizing a Bank Service Charge

Dishonored Checks and Electronic Banking

Recording a Dishonored Check on a Check Stub

Journalizing a Dishonored Check

Journalizing an Electronic Funds Transfer

Journalizing a Debit Card Transaction

Petty Cash

Establishing a Petty Cash Fund

Making Payments from a Petty Cash Fund with a Petty Cash Slip

Replenishing Petty Cash

Chapter 6Work Sheet for a Service Business

Creating a Work Sheet

Consistent Reporting

Fiscal Periods

Work Sheet

Preparing the Heading of a Work Sheet

Preparing a Trial Balance on a Work Sheet

Planning Adjusting Entries on a Work Sheet

Planning Adjustments on a Work Sheet

Supplies Adjustment on a Work Sheet

Prepaid Insurance Adjustment on a Work Sheet

Proving the Adjustments Columns of a Work Sheet

Summary of Preparation of a Work Sheet for a Service Business

Preparing a Work Sheet

Extending Financial Statement Information on a Work Sheet

Extending Balance Sheet Account Balances on a Work Sheet

Extending Income Statement Account Balances on a Work Sheet

Recording Net Income, and Totaling and Ruling a Work Sheet

Calculating and Recording a Net Loss on a Work Sheet

Finding and Correcting Errors on the Work Sheet

Correcting Accounting Errors on the Work Sheet

Checking for Typical Calculation Errors

Checking for Errors in the Work Sheet

Check for Errors in the Trial Balance Column

Check for Errors in the Adjustments Columns

Check for Errors in the Income Statement and Balance Sheet Columns

Correcting an Error in Posting to the Wrong Acc

Correcting an Incorrect Amount and an Amount Posted to the Wrong Column

Checking for Errors in Journal Entries

Preventing Errors

Chapter 7Financial Statements for a Proprietorship

Preparing an Income Statement

Reporting Financial Information

Income Statement Information on a Work Sheet

Heading of an Income Statement

Revenue, Expenses, and Net Income Sections of an Income Statement

Component Percentage Analysis of an Income Statement

Acceptable Component Percentages

Total Expenses Component Percentage

Net Income Component Percentage

Income Statement with Two Sources of Revenue and a Net Loss

Balance Sheet Information on a Work Sheet

Balance Sheet

Heading of a Balance Sheet

Assets and Liabilities Sections of a Balance Sheet

Owners Equity Section of a Balance Sheet

Owners Equity Reported in Detail on a Balance Sheet

Chapter 8Recording Adjusting and Closing Entries for a Service Business

Adjusting Entries

Recording Adjusting Entries

Adjusting Entries

Adjusting Entry for Supplies

Adjusting Entry for Prepaid Insurance

Recording Closing Entries

Need for Permanent and Temporary Accounts

Need For Closing Temporary Accounts

Need for the Income Summary Account

Closing Entry for an Income Statement Account with a Credit Balance

Closing Entry for Income Statement Accounts with Debit Balances

Closing Entry to Record Net Income or Loss and Close the Income Summary Account

Closing Entry for the Owners Drawing Account

Preparing a Post-Closing Trial Balance

General Ledger Accounts after Adjusting and Closing Entries Are Posted

Post-Closing Trial Balance

Accounting Cycle for a Service Business

PART 2ACCOUNTING FOR A MERCHANDISING BUSINESS ORGANIZED AS A CORPORATION

Chapter 9Journalizing Purchases and Cash PaymentsJournalizing Purchases Using a Purchases Journal

Merchandising Businesses

The BusinessHobby Shack, Inc.

Using Special Journals

Purchasing Merchandise

Purchases on Account

Purchases Journal

Purchase Invoice

Purchasing Merchandise on Account

Totaling and Ruling a Purchases Journal

Journalizing Cash Payments Using a Cash Payments Journal

Cash Payments Journal

Cash Payment of an Expense

Buying Supplies for Cash

Cash Payments for Purchases

Trade Discount

Cash Purchases

Cash Payments on Account with Purchases Discounts

Cash Payments on Account without Purchases Discounts

Performing Additional Cash Payments Journal Operations

Petty Cash Report

Replenishing a Petty Cash Fund

Totaling, Proving, and Ruling a Cash Payments Journal Page to Carry Totals Forward

Starting a New Cash Payments Journal Page

Totaling, Proving, and Ruling a Cash Payments Journal at the End of a Month

Journalizing Other Transactions Using a General Journal

General Journal

Memorandum for Buying Supplies on Account

Buying Supplies on Account

Debit Memorandum for Purchases Returns and Allowances

Journalizing Purchases Returns and Allowances

Chapter 10Journalizing Sales and Cash Receipts Using Special Journals

Journalizing Sales on Account Using a Sales Journal

Sales Tax

Sales of Merchandise on Account

Sales Journal

Sales Invoice

Sale on Account

Totaling, Proving, and Ruling a Sales Journal

Journalizing Cash Receipts Using a Cash Receipts Journal

Processing Sales Transactions

Processing Credit Cards

Cash Receipts Journal

Cash and Credit Card Sales

Cash Receipts on Account

Calculating Cash Receipts on Account with Sales Discount

Journalizing Cash Receipts on Account with Sales Discounts

Totaling, Proving, and Ruling a Cash Receipts Journal

Proving Cash at the End of a Month

Recording Transactions Using a General Journal

Credit Memorandum for Sales Returns and Allowances

Sales Returns and Allowances

Journalizing Sales Returns and Allowances

Chapter 11Posting To General and Subsidiary Ledgers

Posting to an Accounts Payable Ledger

Ledgers and Controlling Accounts

General Ledger

Subsidiary Ledgers

Accounts Payable Ledger and General Ledger Controlling Account

Accounts Payable Ledger Forms

Posting from a Purchases Journal to an Accounts Payable Ledger

Posting from a Cash Payments Journal to an Accounts Payable Ledger

Posting Credit and Debit Entries from a General Journal to an Accounts Payable

Completed Accounts Payable Ledger

Proving the Accounts Payable Ledger

Posting to an Accounts Receivable Ledger

Accounts Receivable Ledger and General Ledger Controlling Account

Accounts Receivable Ledger Forms

Posting From a Sales Journal to an Accounts Receivable Ledger

Posting From a Cash Receipts Journal to an Accounts Receivable Ledger

Posting a Credit Entry from a General Journal to an Accounts Receivable Ledger

Completed Accounts Receivable Ledger

Proving the Accounts Receivable Ledger

Posting from Journals to a General Ledger

Starting a New Page for an Account in a General Ledger

Posting from the General Amount Columns of a Cash Payments Journal to a General Ledger

Posting a Debit Entry from a General Journal to a General Ledger

Posting a Credit Entry from a General Journal to a General Ledger

Posting Special Journal Totals to a General Ledger

Posting the Total of a Purchases Journal to a General Ledger

Posting Special Amount Column Totals of a Cash Receipts Journal to a General Ledger

Posting Special Amount Column Totals of a Cash Payments Journal to a General Ledger

Order of Posting from Special Journals

Correcting Errors in Subsidiary Ledger Accounts

Journalizing Correcting Entries Affecting Customer Accounts

Posting Correcting Entries Affecting Customer Accounts

Chapter 12Preparing Payroll RecordsPreparing Payroll Time Cards

Paying Employees

Analyzing a Payroll Time Card

Calculating Employee Hours Worked

Calculating Employee Total Earnings

Determining Payroll Tax Withholding

Payroll Taxes

Employee Income Tax

Employees Withholding Allowance Certificate

Employees Income Tax WithholdingSingle Persons

Employees Income Tax WithholdingMarried Persons

Employee Social Security and Medicare Tax

Preparing Payroll Records

Payroll Register

Employee Earnings Records

Preparing Payroll Checks

Payroll Bank Account

Employees Payroll Check

Electronic Funds Transfer

Chapter 13Payroll Accounting, Taxes, and ReportsRecording a Payroll

Different Forms of Payroll Information

Payroll Register

Analyzing Payment of a Payroll

Journalizing Payment of a Payroll

Recording Employer Payroll Taxes

Calculating Employer Payroll Taxes

Employer Social Security and Medicare Taxes

Unemployment Taxable Earnings

Unemployment Taxes

Federal Unemployment Tax

State Unemployment Tax

Journalizing Employer Payroll Taxes

Reporting Withholding and Payroll Taxes

Employer Annual Report to Employees of Taxes Withheld

Employers Quarterly Federal Tax Return

Preparing Employers Quarterly Federal Tax Return

Employer Annual Reporting of Payroll Taxes

Paying Withholding and Payroll Taxes

Paying the Liability for Employee Income Tax, Social Security Tax, and Medicare Tax

Form 8109, Federal Deposit Coupon

Journalizing Payment of Liability for Employee Income Tax, Social Security Tax, and Medicare Tax

Paying the Liability for Federal Unemployment Tax

Journalizing Payment of Liability for Federal Unemployment Tax

Journalizing Payment of Liability for State Unemployment Tax

Chapter 14Distributing Dividends and Preparing a Work Sheet for a Merchandising BusinessDistributing Corporate Earnings to Stockholders

Financial Information

Stockholders Equity Accounts Used by a Corporation

Declaring a Dividend

Paying a Dividend

Beginning an 8-Column Work Sheet for a Merchandising Business

Entering a Trial Balance on a Work Sheet

Planning Adjustments on a Work Sheet

Recording a Trial Balance on a Work Sheet

Analyzing and Recording Supplies Adjustments

Analyzing Supplies Adjustments

Recording Supplies Adjustments on a Work Sheet

Analyzing and Recording a Prepaid Insurance Adjustment

Analyzing a Prepaid Insurance Adjustment

Recording a Prepaid Insurance Adjustment

Planning and Recording a Merchandise Inventory Adjustment

Merchandise Inventory

Analyzing and Recording a Merchandise Inventory Adjustment

Analyzing an Adjustment When Ending Merchandise Inventory Is Greater Than Beginning Merchandise Inventory

Planning and Recording an Allowance for Uncollectible Accounts Adjustment

Allowance Method of Recording Losses from Uncollectible Accounts

Estimating Uncollectible Accounts Expense

Analyzing and Recording an Adjustment for Uncollectible Accounts Expense

Planning and Recording Depreciation Adjustments

Categories of Assets

Depreciating Plant Assets

Calculating Depreciation Expense and Book Value

Straight-Line Depreciation

Calculating Accumulated Depreciation

Calculating Book Value

Analyzing and Recording Adjustments for Depreciation Expense

Calculating Federal Income Tax and Completing a Work Sheet

Federal Income Tax Expense Adjustment

Calculating Federal Income Tax

Recording the Federal Income Tax Adjustment

Completing a Work Sheet

A Completed 8-Column Work Sheet

A 10-Column Work Sheet (left page)

A 10-Column Work Sheet (right page)

Chapter 15Financial Statements for a CorporationPreparing an Income Statement

Uses of Financial Statements

Income Statement Information on a Work Sheet

Revenue Section of an Income Statement for a Merchandising Business

Cost of Merchandise Sold Section of an Income Statement for a Merchandising Business

Completing an Income Statement for a Merchandising Business

Analyzing an Income Statement

Using Component Percentages

Acceptable Component Percentages

Analysis of Component Percentages

Cost of Merchandise Sold Component Percentage

Gross Profit on Sales Component Percentage

Total Expenses Component Percentage

Net Income before Federal Income Tax Component Percentage

Analyzing an Income Statement Showing a Net Loss

Actions to Correct Unacceptable Component Percentages

Unacceptable Component Percentage for Gross Profit on Sales

Unacceptable Component Percentage for Total Expenses

Unacceptable Component Percentage for Net Income before Federal Income Tax

Financial Ratios

Earnings per Share

Price-Earnings Ratio

Preparing a Statement of Stockholders Equity

Capital Stock Section of the Statement of Stockholders Equity

Retained Earnings Section of the Statement of Stockholders Equity

Preparing a Balance Sheet

Balance Sheet Information on a Work Sheet

Current Assets Section of a Balance Sheet

Plant Assets Section of a Balance Sheet

Liabilities Section of a Balance Sheet

Stockholders Equity Section of a Balance Sheet

Completed Balance Sheet

Supporting Schedules for a Balance Sheet

Chapter 16Recording Adjusting and Closing Entries for a CorporationRecording Adjusting Entries

Adjusting Entries Recorded from a Work Sheet

Adjusting Entry for Allowance for Uncollectible Accounts

Adjusting Entry for Merchandise Inventory

Adjusting Entry for SuppliesOffice

Adjusting Entry for SuppliesStore

Adjusting Entry for Prepaid Insurance

Adjusting Entry for DepreciationOffice Equipment

Adjusting Entry for DepreciationStore Equipment

Adjusting Entry for Federal Income Taxes

Recording Closing Entries for Income Statement Accounts

The Income Summary Account

Closing Entry for Accounts with Credit Balances

Closing Entry for Income Statement Accounts with Debit Balances

Summary of Closing Entry for Income Statement Accounts with Debit Balances

Closing Entry to Record Net Income

Closing Entry for Dividends

Completed Closing Entries for a Corporation Recorded in a Journal

Preparing a Post-Closing Trial Balance

Completed General Ledger After Adjusting and Closing Entries Are Posted

Post-Closing Trial Balance

Accounting Cycle for a Merchandising Business Organized as a Corporation

PART 3ACCOUNTING FOR A MERCHANDISING BUSINESS ORGANIZED AS A CORPORATIONADJUSTMENTS AND VALUATION

Chapter 17Accounting for Uncollectible Accounts Receivable

Uncollectible Accounts

The BusinessRestaurant Supply Co.

Estimating and Recording Uncollectible Accounts Expense

Analyzing and Journalizing an Adjustment for Uncollectible Accounts Expense

Posting an Adjusting Entry for Uncollectible Accounts Expense

Writing Off and Collecting Uncollectible Accounts Receivable

Journalizing Writing Off an Uncollectible Account Receivable

Posting an Entry to Write Off an Uncollectible Account Receivable

Reopening an Account Previously Written Off

Recording Cash Received for an Account Previously Written Off

Posting Entries for Collecting a Written-Off Account Receivable

Chapter 18Accounting for Plant Assets and DepreciationBuying Plant Assets and Paying Property Tax

Recording the Buying of a Plant Asset

Calculating and Paying Property Tax

Calculating Depreciation Expense

Straight-Line Depreciation

Calculating Depreciation Expense for Part of a Year

Calculating Accumulated Depreciation and Book Value

Calculating Accumulated Depreciation

Calculating Book Value

Journalizing Depreciation Expense

Preparing Plant Asset Records

Journalizing Annual Depreciation Expense

Posting an Adjusting Entry for Depreciation Expense

Disposing of Plant Assets

Sale of a Plant Asset for Book Value

Recording a Plant Assets Depreciation Expense for a Partial Year

Sale of a Plant Asset for More than Book Value

Sale of a Plant Asset for Less than Book Value

Declining-Balance Method of Depreciation

Calculating Depreciation Using the Double Declining-Balance Method

Calculating the Last Years Depreciation Expense

Comparison of Two Methods of Depreciation

Chapter 19Accounting for Inventory

Determining the Quantity of Merchandise Inventory

Why Merchandise Inventory Is Important

The Most Efficient Quantity of Inventory

Methods Used to Determine the Quantity of Merchandise Inventory

Inventory Record

Stock Record

Perpetual Inventory Using a Computer

Determining the Cost of Merchandise Inventory

First-In, First-Out Inventory Costing Method

Last-In, First-Out Inventory Costing Method

Weighted-Average Inventory Costing Method

Calculating the Cost of Merchandise Sold

Comparison of Inventory Methods

Estimating Inventory

Gross Profit Method of Estimating Inventory

Estimating Inventory for Other Months

Chapter 20Accounting for Notes and Interest

Promissory Notes

When Lending and Borrowing Are Necessary

Uses of Promissory Notes

Interest on Promissory Notes

Maturity Date of Promissory Notes

Notes Payable

Signing a Note Payable

Paying Principal and Interest on a Note Payable

Signing a Note Payable for an Extension of Time

Paying a Note Payable Issued for an Extension of Time

Notes Receivable

Accepting a Note Receivable from a Customer

Collecting Principal and Interest on a Note Receivable

Recording a Dishonored Note Receivable

Chapter 21Accounting for Accrued Revenue and Expenses

Accrued Revenue

Accounting for Interest at the Fiscal Year End

Analyzing an Adjustment for Accrued Interest Income

Posting an Adjusting Entry for Accrued Interest Income

Reversing Entry for Accrued Interest Income

Collecting a Note Receivable Issued in a Previous Fiscal Period

Accrued Expenses

Analyzing an Adjustment for Accrued Interest Expense

Posting an Adjusting Entry for Accrued Interest Expense

Reversing Entry for Accrued Interest Expense

Paying a Note Payable Signed in a Previous Fiscal Period

Effect of Not Using Reversing Entries

Chapter 22End-Of-Fiscal-Period Work for a CorporationPreparing a Work Sheet for a Corporation

Preparing Financial Statements

Use of a Work Sheet

Entering a Trial Balance on a Work Sheet

Planning Adjustments on a Work Sheet

Interest Income Adjustment

Supplies Adjustment

Federal Income Tax Adjustment

Completing a Work Sheet

Completed Work Sheet

Preparing an Income Statement

Income Statement

Uses of an Income Statement

Analyzing an Income Statement

Acceptable Component Percentages

Preparing a Statement of Stockholders Equity and Balance Sheet

Statement of Stockholders Equity

Balance Sheet

Preparing a Balance Sheet

Assets

Liabilities

Stockholders Equity

Analyzing a Balance Sheet

Working Capital

Current Ratio

Adjusting, Closing, and Reversing Entries for a Corporation

Adjusting Entries

Closing Entries for a Corporation

Closing Entry for Accounts with Credit Balances

Closing Entry for Accounts with Debit Balances

Closing Entry to Record Net Income

Closing Entry for Dividends

Reversing Entries

Accounting Cycle for a Merchandising Business Organized as a Corporation

PART 4ADDITIONAL ACCOUNTING PROCEDURES

Chapter 23Accounting for Partnerships

Forming a Partnership

Partnerships

The BusinessGiftPak Company

Partnership Agreements

Initial Investments by Owners

Withdrawal of Cash by Partner

Withdrawal of Merchandise by Partner

Distribution of Net Income and Owners Equity Statements

Distribution of Net Income Statement

Distribution of Net Income Statement with Unequal Distribution of Earnings

Partners Capital and Drawing Accounts

Owners Equity Statement

Owners Equity Statement with an Additional Investment and a Net Loss

Balance Sheet for a Partnership

Dissolving a Partnership

Account Balances Before Realization

Gain on Realization

Recognizing a Gain on Realization

Loss on Realization

Liquidating Liabilities

Account Balances After Liquidation of Noncash Assets and Payment of Liabilities

Distributing Loss or Gain on Realization to Partners

Distributing Remaining Cash to Partners

Chapter 24Recording International and Internet Sales

Recording International Sales

International Sales

International Sales Compared with Domestic Sales

Processing an International Sale

Collecting Payment for an International Sale

Journalizing an International Sale

Journalizing Time Drafts

Journalizing Cash Receipts from Time Drafts

Trade Acceptances

Recording Internet Sales

Internet Sales

Journalizing an Internet Sale

2009 South-Western, Cengage Learning