SPECIAL JOURNALS

REASONS FOR SPECIAL JOURNALS

 To promote efficiency, economy, and control, businesses use.

 Division of labor
 It decongest the general journal.
 It reduces the work in entering data and posting to the general
ledger.

TYPES OF SPECIAL JOURNALS

JOURNAL TRANSACTIONS SUPPORTING FORMS

Sales Journal(SJ) Sale of merchandise Sales invoice
Cash Receipts Journal(CRJ) Collection/Cash Receipts Official Receipt
Purchases Journal(PJ) Collection/Cash Receipts Purchase invoice
Cash Disbursements Journal Cash Payments Cash Voucher
(CDJ)
General Journal (GJ) Other transactions Journal Voucher

Nature and uses of the Special Journals

 Sales journal - use to record sale of merchandise regardless of the term

(cash, on account or combination terms)

 Cash Receipts Journal (CRJ) – use for all cash receipts regardless of the
source as long as related to the business.

 Purchases Journal(PJ) - use for all purchases of merchandise regardless

of the term (cash, on account or combination terms).

 Cash Disbursements Journal(CDJ) – use for all payments regardless of

the use as long as related to the business.

 General Journal – use to record transactions that do not qualify in any

of the above special journals. (e.g. return of merchandise under credit
terms)
Rules in recording sale and purchase of merchandise with combination
terms:

 Sale of merchandise terms, cash basis.

 Record the transaction first to the Sales Journal. Debit, Cash Sales, Credit, Sales.
 Next, record to the Cash Receipts Journal: Debit, Cash; Credit, Cash Sales. With
this entry in effect, the cash sales account is zeroed out and the prevailing entry
is: Debit Cash, Credit, Sales.

Cont’d:

 For sale of merchandise evidenced by promissory note:

 First, record to the Sales Journal as if it is sales on account. Dr. Accounts
Receivable; Credit Sales.
 Next, record to the General Journal: Dr., Notes Receivable; Credit, Accounts
Receivable.
 In effect, the prevailing entry would be, Debit, Notes Receivable, Credit Sales.

Sale of merchandise: Terms: Cash and on

account

 First record the transaction in full amount to the Sales Journal as if the sale is on
account: Debit, Accounts Receivable; Credit Sales

 Next, record to the Cash Receipts Journal to record the partial collection: Debit,
Cash, Credit, Accounts Receivable.

 In effect, this entry, reduces the Accounts Receivable initially recorded in the Sales
Journal.

Sale of merchandise, terms: down payment,

with a note and on account.

 First, record the whole transaction as if the term is on account to the Sales Journal.
Debit, Accounts Receivable; Credit, Sales.

 Next, Go the Cash Receipts Journal to record the down payment. Debit, Cash; Credit,
Accounts Receivable.

 Also, go the General Journal, record the sale with a note. Debit, Notes Receivable,
Credit, Accounts Receivable.
 Purchase of merchandise: Terms: Cash basis

 First, record the transaction to the Purchases Journal. Debit, Purchases, Credit, Cash
Purchases.

 Next, proceed to the Cash Disbursements Journal to record the cash paid. Debit,
Cash Purchases; Credit, Cash.

 In effect, the cash purchases account is zeroed out. The prevailing entry would be:
Debit, Purchases, Credit Cash.

Purchases of merchandise in cash and on

account

 First, record to the Purchases Journal as if the transaction is purely purchases on

account. Debit, Purchases; Credit, Accounts
Payable.

 Next, record the down payment to the Cash Disbursements Journal. Debit, Accounts
Payable, Credit, Cash.

 In effect, the Purchases on account will be net of the down payment.

Purchase of merchandise with the terms: down

payment, on account and with a note

 First, record the transaction as if it is fully on account to the Purchases Journal,

Debit, Purchases, Credit, Accounts Payable

 Next, record the down payment to the Cash Disbursements Journal. Debit Accounts
Payable; Credit, Cash.

 Then, record the purchases with a note to the General Journal. Debit, Accounts
Payable; Credit, Notes Payable.