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EMS Term 2 - LESSON 2

Financial literacy: DEBTORS - SOURCE DOCUMENTS & JOURNALS
 Term 2

Lesson 1&2 - DEBTORS (CONCEPTS, CREDIT

Financial literacy term 2 TRANSACTIONS, SOURCE
DOCUMENTS & JOURNALS)
Lesson 3&4 - DEBTORS (GENERAL
LEDGER, Debtors ledger)
 Revision of concepts:CREDIT SALES
● Debtor – a person who owes money to the business when buying
goods on credit
● Credit invoice – source document as proof for credit sales
● Debtors Journal (DJ) – book of first entry where all credit sales
are recorded for a month.
● Debtors’ journal is part of the third step in the accounting cycle.
SOURCE DOCUMENT: CREDIT INVOICE

ORIGINAL DUPLICATE
INVOICE: INVOICE:
The client
The business
receives it.
keeps it.
 1
3

4
5
6
 FORMAT OF THE DEBTORS JOURNAL:
Debtors Journal of IKASI KOFU COMPANY DJ1
Doc Day Debtors Fol. Sales Cost of sales
No.

the name of a person/business to which

Source the total selling price
goods were sold on credit. The total cost for
document of goods sold the goods sold
Day on which the It is used for cross reference, i.e., to show the
transaction took number of the account in the Debtors ledger. This is the folio number of the journal (D for
place Debtors, J for Journal and 1 for the number of the
journal i.e., the first journal for the business will
be 1 the next 2 etc.
EXAMPLE: TRANSACTIONS RECORDED IN THE DJ
Complete the Debtors journal of IKASI KOFU COMPANY for March 2022. They use a profit mark-up of
20% on cost.
4 Goods were sold to Femi Traders for R4 800 on credit. Issued invoice no. 57.

Debtors journal of IKASI KOFU COMPANY – March 2022 DJ1

Doc/ Day Debtor Fol Sales Cost of Sales

no

57 4 Femi Traders 4 800 00 4 000 00

EXAMPLE: TRANSACTIONS RECORDED IN THE DJ
Complete the Debtors journal of IKASI KOFU COMPANY for March 2022. They use a profit mark-up of
20% on cost.
8 Sold goods on credit for R3 600 to Hakim Suppliers.

Debtors journal of IKASI KOFU COMPANY – March 2022 DJ1

Doc/no Day Debtor Fol Sales Cost of Sales

57 4 Femi Traders 4 800 00 4 000 00

58 8 Hakim Suppliers 3 600 00 3 000 00

EXAMPLE: TRANSACTIONS RECORDED IN THE DJ
Complete the Debtors journal of IKASI KOFU COMPANY for March 2022. They use a profit mark-up of
20% on cost.
12 Merchandise sold on credit to Lethabo Traders for R900.
Debtors journal of IKASI KOFU COMPANY – March 2022 DJ1

Doc/no Day Debtor Fol Sales Cost of Sales

57 4 Femi Traders 4 800 00 4 000 00

58 8 Hakim Suppliers 3 600 00 3 000 00

59 12 Lethabo Traders 900 00 750 00

 EXAMPLE: TRANSACTIONS RECORDED IN THE DJ
18 Issued an invoice to Siyabonga Suppliers for goods delivered to him on credit, R1 200.
Debtors journal of IKASI KOFU COMPANY – March 2022 DJ1

Doc/no Day Debtor Fol Sales Cost of Sales

57 4 Femi Traders 4 800 00 4 000 00

58 8 Hakim Suppliers 3 600 00 3 000 00

59 12 Lethabo Traders 900 00 750 00

60 18. Siyabonga Suppliers 1 200 00 1 000 00

10 500 00 8 750 00
 RECEIPTS OF MONEY FROM DEBTORS:
● At some point, a debtor must settle his/her account.
● If the debtor settles the account, the business receives money, and a receipt
is issued.
● The original receipt is handed to the debtor and the duplicate serves as a
source document used by the business as the first entry.
● Money is received and the amount should be recorded in the Cash
Receipts Journal.
● An analysis column for debtors control will be opened as debtors pay their
debts.
 AN EXAMPLE OF A RECEIPT:
RECEIPT
No 311

15 March 2022

Received with thanks from G. Gold

the amount of Three thousand six hundred and twenty rand and no cents

for payment of account

K.Makeba
For IKASI KOFU COMPANY
EXAMPLE: TRANSACTIONS RECORDED IN THE CRJ
Received R1 500 on 2 March 2022 from D Dakarai as partial payment on
his account. Issue receipt 34.
Cash Receipt Journal of IKASI KOFU COMPANY for March 2022 CRJ1

Doc Day Details Fol Analysis of Bank Debtors control

receipts

34 2 D Dakarai 1 500 1 500 1 500

The amount of the debt

paid by the debtor
Click on the image to access the
self-marking assessment for
lesson 2

Slides created by Mrs. J Louw

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