C hapter 12: The sales journal and

the sales ledger

Contents of chapter
This chapter examines how sales invoices are made, and then explains how such transactions are entered into
the books. It also looks at the nature of trade discounts and how they affect sales invoice calculations.

Notes for teachers

Many businesses in Hong Kong deal exclusively with cash sales, e.g.
1
(i) Market stalls of a retail nature.
(ii) Many small shops.

Credit sales are more likely to be found with:

2
(i) Wholesalers.
(ii) Manufacturers.

It should be fairly easy to obtain some old sales invoices to show to the students. Compare the layouts on
3
the different invoices.

The steps for posting credit sales to the sales ledger and general ledger are shown on p. 121.
4

Trade discounts are used only as a means of calculating the selling price. As such they are not entered
5
into double entry accounts. The only place they might appear is on the face of a sales invoice.

Students should be able to distinguish between trade debtors and non-trade debtors because different
6
books are used for recording transactions with them.

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 Answers to MCQs and exercises
12.1 C 12.2 B 12.3 D 12.4 D 12.5 A 12.6 D 12.7 C

12.8
Sales Journal
20X6 $
Mar 1 Gold Wheel Ltd 187
" 3 T Au 166
" 6 W Wong 12
" 10 Gold Wheel Ltd 55
" 17 Y Wan 289
" 19 Rainbow Ltd 66
" 27 V Wong 28
" 31 Y Sin 78
" 31 Transferred to sales account 881

Sales Ledger
Gold Wheel Ltd
20X6 $
Mar 1 Sales 187
" 10 Sales 55

T Au
20X6 $
Mar 3 Sales 166

W Wong
20X6 $
Mar 6 Sales 12

Y Wan
20X6 $
Mar 17 Sales 289

Rainbow Ltd
20X6 $
Mar 19 Sales 66

V Wong
20X6 $
Mar 27 Sales 28

Y Sin
20X6 $
Mar 31 Sales 78

General Ledger
Sales
20X6 $
Mar 31 Total for the month 881

60
12.9X
Sales Journal
20X6 $
May 1 C Chen 305
" 3 T Yuen 164
" 5 B Ho 45
" 7 M Lee 100
" 16 K Kwong Ltd 308
" 23 Victory Ltd 212
" 30 T Sang 1,296
" 31 Transferred to sales account 2,430

Sales Ledger
C Chen
20X6 $
May 1 Sales 305

T Yuen
20X6 $
May 3 Sales 164

B Ho
20X6 $
May 5 Sales 45

M Lee
20X6 $
May 7 Sales 100

K Kwong Ltd
20X6 $
May 16 Sales 308

Victory Ltd
20X6 $
May 23 Sales 212

T Sang
20X6 $
May 30 Sales 1,296

General Ledger
Sales
20X6 $
May 31 Total for the month 2,430

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 12.10
(a) 20X7 $ $ $
May 1 C Wing 3 rolls white tape × $10 = 30
5 sheets blue cotton × $6 = 30
1 dress length black silk × $20 = 20 80
Less Trade discount 25% 20 60

" 4 W Tsang Ltd 6 rolls white tape × $10 = 60

30 metres green baize × $4 = 120 180
Less Trade discount 33 1 % 60 120
3

" 8 Sun Hing Ltd 1 dress length black silk × $20 = 20

" 20 W Au 10 rolls white tape × $10 = 100

6 sheets blue cotton × $6 = 36
3 dress lengths black silk × $20 = 60
11 metres green baize × $4 = 44 240
Less Trade discount 25% 60 180

" 31 K Chan 12 rolls white tape × $10 = 120

14 sheets blue cotton × $6 = 84
9 metres green baize × $4 = 36 240
Less Trade discount 33 1 % 80 160
3

(b) Sales Journal

Date Details Amount
20X7 $
May 1 C Wing 60
" 4 W Tsang Ltd 120
" 8 Sun Hing Ltd 20
" 20 W Au 180
" 31 K Chan 160
" 31 Transferred to sales account 540

Sales Ledger
C Wing
20X7 $
May 1 Sales 60

W Tsang Ltd
20X7 $
May 4 Sales 120

Sun Hing Ltd

20X7 $
May 8 Sales 20

W Au
20X7 $
May 20 Sales 180

K Chan
20X7 $
May 31 Sales 160

(c) General Ledger

Sales
20X7 $
May 31 Total for the month 540

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12.11X
(a) Invoice summaries:
20X5
Jun 1 T Ping Co $
22 metres plastic tubing × $1 22
6 sheets foam rubber × $3 18
4 boxes vinyl padding × $5 20
60
Less Trade discount 25% 15
45

" 2 K Ho
50 lengths polythene sheeting × $2 100
8 boxes vinyl padding × $5 40
20 sheets foam rubber × $3 60
200
Less Trade discount 20% 40
160

" 11 Y Lee
4 metres plastic tubing × $1 4
33 lengths polythene sheeting × $2 66
30 sheets foam rubber × $3 90
160
Less Trade discount 25% 40
120

" 21 K Liu
29 metres plastic tubing × $1 29

" 30 Hon Wing Co

32 metres plastic tubing × $1 32
24 lengths polythene sheeting × $2 48
20 boxes vinyl padding × $5 100
180
1
Less Trade discount 33 3
% 60
120

(b) Sales Journal

20X5 $
Jun 1 T Ping Co 45
" 2 K Ho 160
" 11 Y Lee 120
" 21 K Liu 29
" 30 Hon Wing Co 120
" 30 Transferred to sales accunt 474

Sales Ledger
T Ping Co
20X5 $
Jun 1 Sales 45

K Ho
20X5 $
Jun 2 Sales 160

63
 Y Lee
20X5 $
Jun 11 Sales 120

K Liu
20X5 $
Jun 21 Sales 29

Hon Wing Co
20X5 $
Jun 30 Sales 120

(c) General Ledger

Sales
20X5 $
Jun 30 Total for the month 474

12.12
(a) Sales Journal
Date Details Amount
20X8 $
May 1 T Tung 160
" 9 K Ming ($800 × 0.8) 640
" 13 K Mok ($420 × 0.9) 378
" 31 Transferred to sales account 1,178

(b) Sales Ledger

W Wang Ltd
20X8 $ 20X8 $
May 31 Balance b/f 840 May 5 Bank 840

T Tung
20X8 $ 20X8 $
May 1 Balance b/f 360 May 31 Balance c/f 520
" 1 Sales 160
520 520

K Ming
20X8 $ 20X8 $
May 1 Balance b/f 2,080 May 16 Bank 2,080
" 9 Sales 640 " 31 Balance c/f 640
2,720 2,720

K Mok
20X8 $ 20X8 $
May 13 Sales 378 May 31 Cash 189
" 31 Balance c/f 189
378 378

(c) General Ledger

Sales
20X8 $
May 31 Total for the month 1,178

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12.13X
(a) Sales Journal
20X9 $
Jul 5 C Fong Ltd ($950 × 0.8) 760
" 9 W Wing ($1,200 × 0.7) 840
" 14 C Fong Ltd ($350 × 0.9) 315
" 18 T Sin ($1,600 × 0.7) 1,120
" 31 Transferred to sales account 3,035

(b) Sales Ledger

T Wong Ltd
20X9 $ 20X9 $
Jul 1 Balance b/f 960 Jul 24 Bank 960

S Chan
20X9 $ 20X9 $
Jul 1 Balance b/f 120 Jul 11 Cash 40
" 31 Balance c/f 80
120 120

T Sin
20X9 $ 20X9 $
Jul 1 Balance b/f 8,000 Jul 30 Cash 2,000
" 18 Sales 1,120 " 31 Balance c/f 7,120
9,120 9,120

C Fong Ltd
20X9 $ 20X9 $
Jul 1 Balance b/f 1,200 Jul 31 Balance c/f 2,275
" 5 Sales 760
" 14 Sales 315
2,275 2,275

W Wing
20X9 $ 20X9 $
Jul 9 Sales 840 Jul 31 Balance c/f 840

(c) General Ledger

Sales
20X9 $
Jul 31 Total for the month 3,035

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 12.14
Sales Analysis Book
Total Britain Far East USA
20X8 $ $ $ $
May 1 H K Hiram 119 119
" 3 P Osaki 288 288
" 5 B Hardcastle 249 249
" 10 A Smith 44 44
" 15 T Roosevelt 387 387
" 17 L Nakamura 84 84
" 19 C Rockefelles 219 219
" 28 I Aoki 188 188
" 31 S Chang 572 572
2,150 293 1,132 725

12.15X
(a) Sales Anaysis Book
Date Details Total Glass China Miscellaneous
20X6 $ $ $ $
Dec 4 M Kin 1,006 850 156*
" 17 D Tiu 75 75
" 20 P Young 176 72 84 20
1,257 147 934 176
*Buckets $60 + Pans $96 = $156

(b) Sales Ledger

M Kin
20X6 $
Dec 4 Sales 1,006

D Tiu
20X6 $
Dec 17 Sales 75

P Young
20X6 $
Dec 20 Sales 176

General Ledger
Sales: Glass
20X6 $
Dec 31 Total for the month 147

Sales: China
20X6 $
Dec 31 Total for the month 934

Sales: Miscellaneous
20X6 $
Dec 31 Total for the month 176

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