This document provides instruction on accounting for transactions in a service business. It discusses journalizing transactions, the accounting cycle, and the use of T-accounts to record transactions. Examples of financial and non-financial transactions are given. The format of journal entries is also explained.

2. Reviewing previous lesson:
•RULES OF DEBIT AND CREDIT

3. Rules of Debit and Credit:

4. Rules of Debit and Credit:

5. Rules of Debit and Credit:

6. Rules of Debit and Credit:

7. Rules of Debit and Credit:

8. Rules of Debit and Credit:

9. Rules of Debit and Credit:

10. Rules of Debit and Credit:

11. Rules of Debit and Credit:

12. Rules of Debit and Credit:

13. Rules of Debit and Credit:

14. Presenting the New Lesson:
•I WILL GIVE AN ACTIVITY SHEETS. YOU HAVE TO ANSWER 10
ITEMS,
•YOU WILL ONLY WRITE TRUE IF THE STATEMENT IS CORRECT AND
FALSE IF IT IS NOT.

16. MELC/Objective of the lesson:
The learner…
•describes the nature of transactions in a merchandising business.
•records transactions of a merchandising business in the general and
special journals
(ABM_FABM11-IVa-d-30)

17. Presenting examples/instances of the new lesson:
During your previous lessons, you learned the different types of
businesses from the activities you accomplished. Those are service,
merchandising and manufacturing. Each type of business requires
different accounting procedures.
You will start to apply accounting concepts and principles in a service
type of business. A service business offers intangible products to
customers, which means that there is no physical product involved. The
owner earns income by providing services that may benefit and satisfy
the clients. Examples of these are; funeral services, nail salons, hospitals,
and barbershops. It also includes the rendering of services of
professionals like doctors, lawyers, and accountants.

18. Discussing New Concepts
Journalizing is recording of business transactions for a service
business.
This is just one of the steps included in the accounting cycle for our
next activity.

19. Discussing New Concepts
These are the steps in the accounting cycle that will be repeated once the accounting
period ends:
1. Analyzing business transactions from the source documents
2. Journalizing the business transactions
3. Posting journal entries to the ledger
4. Preparing trial balance
5. Journalizing and posting adjusting journal entries
6. Preparing adjusted trial balance
7. Preparing financial statements
8. Journalizing and posting closing entries
9. Preparing post-closing trial balance
10.Journalizing and posting reversing journal entries

20. Practicing New Skills
THIS TIME YOU WILL RECORD EACH TRANSACTION
IN THE T-ACCOUNT.
I WILL PROVIDE ANSWER SHEETS.
Note:
•I will give you ahead the ACCOUNT TITLES.
•In the amount of Pesos, use the Peso sign “₱” and “.00” for
centavos.

21. Practicing New Skills
ACCOUNT TITLES
ASSETS INCOME
Cash Service Revenue
Office Furniture
Account Receivable
LIABILITIES EXPENSES
Utilities Expense
Salaries Expense
OWNER’S EQUITY Rent Expense
Owner’s Equity
Owner’s Withdrawals
Note:
• Above are the ACCOUNT TITLES.
• In the amount of Pesos, use the Peso sign “₱” and “.00” for centavos.

22. Presentation of Outputs

23. Presentation of Outputs

24. Presentation of Outputs

25. Presentation of Outputs

26. Developing Mastery:
Accountants will analyze business documents whether they have
financial impact or none in the business. The transactions which
are only financial in nature and have an economic benefit to the
business and those which may change assets, liabilities, and equity
will be recorded.

27. Developing Mastery:
Examples of financial transactions:
•Payment of salaries of employees
•Payment of electric, water, and telecommunication bills
•Received payment from customers
•Received payment from customers on account
•Payment for purchasing furniture, equipment, and supplies

28. Developing Mastery:
Examples of non-financial transactions:
•Orientation of newly-hired employees
•Posting of advertisements in the city
•Awarding of recognition to the business
•Hiring and terminating of employees

29. Developing Mastery:
The following are examples of source documents:
1. Official receipt or cash receipt
2. Charge invoice or sales invoice
3. Check or Cash voucher
4. Deposit slips

30. Developing Mastery:
The journal is the accountant’s tool in recording the day-to-day
transactions. It is called the book of original entry, where the
accountant records first the business transactions that occurred in
the business. The recording of business transactions is in
sequential form.

31. Developing Mastery:
Format
The journal consists of the following information:
1. Date. Enter the date when the transaction occurred. The year and month may be omitted if the transaction occurred in
the same year and month.
2. Account Titles and Explanation. First, enter the account to be debited. It must be located at the extreme left of the first
line, while the account to be credited must be located at the next line which is slightly indented. A brief description of
the transaction is usually made on the line below the credit. Generally, skip the line after the entry.
3. P.R. (Posting Reference). The chart of accounts provides account numbers for each account title. The accountant will
enter those account numbers in this column once the account titles are used in a journal entry.
4. Debit. The amount to be debited is entered in this column.
5. Credit. The amount to be credited is entered in this column.

32. Developing Mastery:

33. Developing Mastery:

34. Developing Mastery:

35. Finding Practical Applications:
In case you are the Owner of the business or it is your Family business:

36. Making Generalizations:
This will test if you understand the whole concept of our lesson.

37. Evaluation:
I will give worksheets for your evaluation. Use that as your answer sheets,
since it was your first time I will allow you to use pencil but see to it that it
would be still look nicely of avoiding more erasures.
Please do not ask your classmates. Call my attention if you need