You may wish to point out the useful table that summarizes common transaction terminology on page 58 of the text. TM 2-6 shows a series of transactions recorded in a two-column journal. Use this exhibit to review the two-column journal format with your students. You may want to stress the following format issues: The year is entered only at the top of the date column. The month is entered on the first Dates: line of the date column on each page; it is also entered for the first transaction whenever changing to a new month. The date is entered for each transaction. The description column is where account names are entered. Debited accounts should be on top, and credited accounts should be on the bottom and indented to the right (credits are always on the right). Proper journalizing always has at least one debit and one credit, and total debits must always equal total credits. Proper journalizing will keep the accounting equation in balance. A description of the transaction should be written below the debit and credit Explanations: account titles. This description may be omitted if the transaction is a normal business occurrence and its nature is obvious from the entry. When calculations are required, they should be noted here. A blank line should separate all transactions in a manual journal to make them easier Blank Lines: to read. Computerized systems are normally designed to separate journal entries without special input. It is also helpful to emphasize the importance of using the correct journal entry format of left justifying debits and indenting credits by writing the following entry on the board and asking students to identify what is wrong: Supplies 500 Cash 500 Since the credit in the entry is not indented, it is difficult to identify the debit and the credit. Were supplies purchased using cash, or were they sold for cash? In most computerized systems, the indention of the of accounts credited is not necessary because debits and credits are recorded in separate columns. OBJECTIVE 3 Describe and illustrate the journalizing and posting of transactions to accounts.
You may wish to point out the useful table that summarizes common transaction terminology on page 58 of the text. TM 2-6 shows a series of transactions recorded in a two-column journal. Use this exhibit to review the two-column journal format with your students. You may want to stress the following format issues: Dates: The year is entered only at the top of the date column. The month is entered on the first line of the date column on each page; it is also entered for the first transaction whenever changing to a new month. The date is entered for each transaction. The description column is where account names are entered. Debited accounts should be on top, and credited accounts should be on the bottom and indented to the right (credits are always on the right). Proper journalizing always has at least one debit and one credit, and total debits must always equal total credits. Proper journalizing will keep the accounting equation in balance. Explanations: A description of the transaction should be written below the debit and credit account titles. This description may be omitted if the transaction is a normal business occurrence and its nature is obvious from the entry. When calculations are required, they should be noted here. Blank Lines: A blank line should separate all transactions in a manual journal to make them easier to read. Computerized systems are normally designed to separate journal entries without special input. It is also helpful to emphasize the importance of using the correct journal entry format of left justifying debits and indenting credits by writing the following entry on the board and asking students to identify what is wrong: Supplies 500 Cash 500 Since the credit in the entry is not indented, it is difficult to identify the debit and the credit. Were supplies purchased using cash, or were they sold for cash? In most computerized systems, the indention of the of accounts credited is not necessary because debits and credits are recorded in separate columns. OBJECTIVE 3 Describe and illustrate the journalizing and posting of transactions to accounts.
Solution-Manual-for-Financial-Accounting-13th-Edition-by-Warren.docx