The document discusses source documents, journals, and the journal entry process. It states that every transaction must have a source document as proof and that source documents contain the necessary information for recording transactions in journals. Journals are used to record transactions in chronological order and include information from source documents like checks, invoices, receipts, and memos. The general journal can record any transaction, identifying the affected accounts and debits and credits. Each journal entry must include the date and source document information.

1. Week 3

2. Business document from which information for
journal entry is obtained.
 Transaction generates source document.
 Each transaction must have a source document
as proof.
 Business must have objective evidence that
transaction actually occurred.
 Source document contains information necessary
for journalizing.


3. Check: document ordering bank to pay cash.
Business records check information on check
stub.
 Invoice: document that describes goods or
services sold, quantity, price.

◦ Sales invoice: recording customer sale on account
Receipt: document acknowledging cash received
by business.
 Memorandum: document on which a message is
written describing a transaction.


4. Book of original entry.
 Used to record transactions in chronological order
(by date).
 Information from source documents is used to add
transactions. Known as an entry.
 Recording information in a journal is known as
journalizing.
 There are different kinds of journals used to
record different kinds of transactions.
 General journal: record any transaction.


5. Each transaction recorded in the journal will
identify the accounts affected (usually 2).
 Each transaction recorded in the journal will
identify the debit and credit parts.
 Helps ensure debits = credits.


6. Every journal page
must be numbered.
All transactions must have a date.
Source document
information added here.
Account title identifies
affected account. Always
list debited account first.

8. Questions?