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Fundamentals of Accountancy, Business and Management 1: Quarter 3 - Module 5: Books of Accounts
Fundamentals of Accountancy, Business and Management 1: Quarter 3 - Module 5: Books of Accounts
Accountancy, Business
and Management 1
Quarter 3 – Module 5:
Books of Accounts
Fundamentals of Accountancy, Business and Management 1 – Grade 11
Alternative Delivery Mode
Quarter 3 – Module 5: Books of Accounts
First Edition, 2020
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Team Leaders:
School Head : Marijoy B. Mendoza, EdD
LRMDS Coordinator : Karl Angelo R. Tabernero
Each SLM is composed of different parts. Each part shall guide you step-by-
step as you discover and understand the lesson prepared for you.
In addition to the material in the main text, Notes to the Teacher are also
provided to our facilitators and parents for strategies and reminders on how they
can best help you on your home-based learning.
Please use this module with care. Do not put unnecessary marks on any part
of this SLM. Use a separate sheet of paper in answering the exercises and tests.
And read the instructions carefully before performing each task.
If you have any questions in using this SLM or any difficulty in answering
the tasks in this module, do not hesitate to consult your teacher or facilitator.
Thank you.
What I Need to Know
This module was designed and written so that you will be able to differentiate
journal from ledger and identify their types (ABM_FABM11-IIIf-23-24).
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What I Know
Directions: Match Column A with Column B. Write your answers on a separate sheet
of paper.
A B
1. It is the most basic journal. A. Purchase Journal
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Lesson
Books of Accounts
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Books are essential to all of us. They are a
common source of information and an integral tool
for learning. In every field of study, there is a
specialized book to be used.
The general journal is the “book of original entry” where you can find the initial
record of the transactions of a firm while the ledger contains the total or balance of
each account.
What’s In
Directions: Identify what is described in each number. Choose your answer from the
box. Write your answers on a separate paper.
____________ 1. These are the debt of the company payable in money, goods, or
services.
____________ 2. It is the list of all the accounts of the company that is being used by
the firm to their financial records.
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____________ 3. These are the resources owned by the owner.
____________ 6. It is a written note from the customer to pay his account on a given
time and date.
____________ 8. These are debts that are supported with a written note or promise.
____________ 9. These are the resources or assets that have been invested in the
business.
What’s New
Directions: Read each statement below carefully. Write T if you think the statement
is true and F if the statement is false. Write your answers on a separate
sheet of paper.
____________ 3. All entries involve only two accounts: one debit and one credit.
____________ 5. Cash Disbursement Journal is used to record all cash that have been
received.
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____________ 6. Cash Receipts Journal is used to record all transactions involving
cash payments.
What Is It
Process of Accounting
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General Journal
The general journal is the most basic journal. It is composed of spaces for dates,
account titles and explanations, references, and two columns for the amount.
As you can see, it includes columns for the date of the transaction, the title of the
accounts to be debited and credited, the reference, the amount of each debit and
credit, and explanation of the transaction.
Journalizing Process
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• October 1, 2019 – He invested Php 300,000.00 in a restaurant business by
opening an account in Velez Bank.
• October 14, 2019 – He started his operations and made sales for that day
amounting to Php 50,000.00.
On October 28, 2019, Mr. Dela Rosa purchased a motorcycle which costs
Php 110,000.00. He paid Php 80,000.00 cash and agreed to pay the remaining
Php 30,000.00 within the month. The compound entry is as follows:
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• Cash Receipts Journal
This is used to record all the cash that has been received.
• Cash Disbursements Journal
This is used to record all the transactions involving cash payments.
• Sales Journal or the Sales on Account Journal
This is used to record all sales on credit or on account.
• Purchase Journal or the Purchase on Account Journal
This is used to record all purchases of inventory on credit or on account.
Date Description Ref. Debit Credit Credit Credit
(Particulars) Cash Sales Accounts Sundry
Receivable
The Sundry column is used for various miscellaneous and less regular items such
as capital investment and receipt loan proceeds.
The Official Receipts or Cash Receipts issued by the business is the source
document for this journal.
The cash disbursements journal is the opposite of the cash receipts journal.
We record all cash payments in the journal.
The table below is a cash disbursement journal of JST Restaurant:
Date Description P.R. Check Credit Debit Debit Debit Credit
(Particulars) or Cash Accounts Salaries Supplies Sundry
Voucher
Payable
No.
2020
Paid employees Php 30,000.00 Php 30,000.00
July 1 101
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The date of the transaction is written in the Date column.
• A brief explanation of the transaction is written in the Description column.
• The column titled P.R. known as (Posting Reference) is left blank when the
journal entry is made. We will use this column later if the journal entries
are transferred to the ledger accounts.
• When it comes to related cash payment, the check or voucher number
represents the identifying number of the check issued. There were times
that a check or cash voucher accompanies the disbursement. We can also
use the voucher number as an alternative for this column.
• The amount of cash received for a particular transaction is entered in the
Debit Cash column.
• Major categories of receipts (cash sales, and collection of accounts
receivable) are provided with separate columns because these transactions
are frequent and repetitive items.
• For various miscellaneous and less regular items (capital investment,
receipt of loan proceeds), the Sundry column is used.
• In updating the journal, the source documents are the check voucher or
cash voucher, cash receipts or official receipts from suppliers or vendors.
The Sales Journal or Sales on Account Journal is used in recording several sales
transactions on account. For credit transactions with various customers or clients,
the source document for this journal is the charge invoice or sales invoice.
Sales Debit
Description Credit
Date P.R. Invoice Accounts
(Customer's Name) Sales
No. Receivable
2020
August Masikap Express 010 Php 20,000.00 Php 20,000.00
• The date of the transaction is entered in the Date column of JST Restaurant
sales journal.
• A brief explanation of the transaction is entered in the description column
or the name of the customer of JST Restaurant sales journal.
• The column titled P.R. or (Posting Reference) is left blank when the journal
entry of JST Restaurant is made. This column is used later when the
journal entries of JST Restaurant are transferred to the ledger accounts.
• The Charge Invoice Number or Sales Invoice Number of JST Restaurant
sales journal represents the identifying number of the source document
issued to the customer when the sale was made.
• The Debit Accounts Receivable column of JST Restaurant sales journal
represents the amount of the sale transactions indicated in the charge
invoice.
• The Credit Sales column of JST Restaurant sales journal represents the
amount of the sale transactions indicated in the charge invoice.
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• The source document for JST Restaurant’s journal is the Charge Invoice
issued by the business.
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An accounting book in which the accounts and their
related amounts as recorded in the journal which are
posted periodically is called the ledger which is also
known as the book of final entry. The reason is that all
the balances in the ledger are used in the preparation
of financial statements. It is also referred to as the T-
Account because the basic form of a ledger is like the
letter “T”.
There are two kinds of ledgers: the general ledger and the subsidiary ledger.
General Ledger
The general ledger is grouping of all accounts used in the preparation of financial
statements. The GL, as accounting professionals call it, summarizes all the activities
that have taken place as recorded in its subsidiary ledger that is why it is known as
the controlling account.
• The account portion refers to the account title (cash and accounts receivable).
• The account number is an assigned number for each account title of the JST
Restaurant to facilitate ease in recording and cross-referencing.
• The Date column of JST Restaurant’s general ledger identifies when the
transaction happened.
• The item represents the source journal and the nature of the transactions of
JST Restaurant.
• The Reference of JST Restaurant’s general ledger identifies the page number
of the general or special journal from which the information was taken.
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• The Debit and Credit columns are used in recording the number of
transactions from the general journal or special journal.
Subsidiary Ledger
Accounts Payable
Subsidiary Ledger
Vendor/Supplier: Vendor No.:
Address:
Date Item P.R. Debit Credit Balance
• The upper portion indicates the name and address of the vendor or supplier
of JST Restaurant.
• The Date column of JST Restaurant’s subsidiary ledger identifies when the
transaction happened.
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• The Debit and Credit columns of JST Restaurant’s subsidiary ledger reflect
the various effects of every transaction to the record of the supplier or
vendor.
Take note that the total running balance for all subsidiary ledgers of JST
Restaurant should be equal to the accounts payable in the general ledger.
What’s More
Directions: Identify the appropriate journal to be used in each item below. Choose
from the book of accounts listed in the box. Write your answers on a
separate sheet of paper.
4. Rhea received Php 20,000.00 for the services that she rendered.
5. Janice paid the salaries of her employees on her accounting firm with the
amount of Php 30,000.00.
9. Julie sold merchandise amounting to Php 20,000.00 with the terms of 2/5,
n/30.
10. Mr. Ong withdrew cash worth of Php 3,000.00 for his personal use.
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What I Have Learned
Directions: Fill in the blanks with the correct accounting term/s. Choose the answers
from the box below and write them on a separate sheet of paper.
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What I Can Do
Directions: Answer the following questions in 3-5 sentences. Write your answers
on a separate sheet of paper.
1. How are you going to differentiate General Ledger from a Subsidiary Ledger?
2. How are you going to differentiate General Journal from a General Ledger?
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Assessment
Directions: Identify what is described in each number. Write the letter of your answer
on a separate sheet of paper.
7. This contains the details supporting the balance in the general ledger account.
A. general ledger C. ledger
B. subsidiary ledger D. none of the above
9. This type of entry involves only two accounts: one debit and one credit.
A. compound entry C. simple entry
B. dual entry D. jumbled entry
11. This type of special journal makes use of official receipts issued by companies.
A. cash disbursement C. purchase journal
B. cash receipts D. sales journal
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12. This is the type of special journal makes use of sales invoices issued by companies.
A. purchase journal C. cash receipt journal
B. sales journal D. cash disbursement journal
13. This is the type of special journal where sales invoice from a supplier may be found.
A. sales journal C. cash receipt journal
B. purchase journal D. cash disbursement journal
14. This is the type of special journal where official receipts from suppliers as proof of
payment may be found.
A. cash disbursement journal C. purchase journal
B. cash receipt journal D. sales journal
15. A cash disbursement journal or cash payments journal is not used to record this
transaction.
A. purchase of merchandise for cash C. all cash received
Additional Activities
Directions: The following are transactions from Marvin Hernandez’s book of account.
Decide which journal to use in each of the given transactions. Write the
letters of your answer on the separate sheet of paper.
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What I Have Learned
1. Journalizing
2. Compound Entry
What I know: 3. Simple entry
1. B 4. Cash Receipts Journal
2. A 5. Cash disbursement Journal
3. C 6. Ledger
4. E 7. General ledger
5. D 8. Subsidiary ledger
9. Purchase Journal
10. Special Journal
11. Communicating
What’s In: 12. Chronological
1. Liabilities 13. Special Journal
2. Chart of Accounts 14. Description Column
3. Assets 15. Date
4. Owner's Equity
5. Cash What I Can Do:
6. Notes Receivable Answers may vary
7. Non-Current Asset
8. Notes Payable
9. Capital
Assessment
10. Prepaid Expenses 1. D
2. B
3. B
What’s New: 4. C
1. F 5. B
2. F 6. A
3. F 7. B
4. T 8. D
5. F 9. C
6. F 10. A
7. T 11. B
8. T 12. B
9. F 13. B
10. T 14. A
15. C
What's More
Additional Activities:
1. General Journal 1. A
2. Sales Journal 2. E
3. Purchase Journal 3. A
4. Cash Receipts Journal 4. A
5. Cash Disbursement Journal 5. B
6. Cash Disbursement Journal 6. B
7. Cash Receipts Journal 7. B
8. Purchase Journal 8. D
9. Sales Journal 9. D
10. General Journal 10. E
Answer Key
References
Gilbertson, Claudia. Fundamentals of Accounting. 8th ed. (Australia: Cengage Learning, 2010).
Padillo, Nicanor, Jr. Financial Statements Preparation, Analysis and Interpretation. (Manila: GIC
Enterprises, 2011).
Pefianco, Erlinda C. The Accounting Process: Principles and Problems. (Makati: Goodwill Trading,
1996).
Teaching Guide for Senior High School, Fundamentals of Accountancy, Business and Management 1.
(Quezon City: Commission on Higher Education, 2016).
IMAGE SOURCE/s:
Bitmoji app
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