Chapter 5

Source documents &

accounting books

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 LEARNING OBJECTIVE

LO 5.1: Identify the elements of accounting documents

LO 5.2: Distinguishing types of accounting books (journal,
general ledger, subsidiary ledger)
LO 5.3: Journalizing an posting transactions
LO 5.4: Prepare trial balance & detailed summary table

2
 Source Documents

• Trigger the analysis of what happened

• Begin the process of entering transactions in
the accounting system
• Serve as objective evidence of business
transactions
• Filed for possible future reference
"Accounting documents are papers and information-
carrying objects reflecting arising and completed
economic and financial transactions, which serve as a
basis for recording accounting books." (Accounting Law,
2015)

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Source Documents

4
Process flow for purchasing goods/services on credit

5
ELEMENTS OF SOURCE DOCUMENTS
Source Documents
Document title/ Document number

The date the document was issued

Name and address of entity/individual setting up document

Name and address of the entity/individual receiving document

Brief description of the transaction

Quantity, unit price, total amounts of the transaction

Signature, full name of the creator, approval and related

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Source Documents

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Source Documents

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 ELECTRONIC SOURCE DOCUMENTS

Ar$cle 17, Accoun$ng Law (2015):

ü Electronic source documents are considered accoun0ng source

document when they have all the essen0al elements of the source
document and are presented in the form of electronic data.

ü Electronic source documents must ensure confiden0ality and

preserve data and informa0on during use and storage.

ü Electronic source documents must have an electronic signature

(Signature on an electronic voucher is as valid as a signature on a
paper documents)

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 ACCOUNTING BOOKS
• Accoun0ng books are used to systema0ze business transac0ons
reflected in documents.
• The accoun0ng book form must clearly state:
+ name of the accoun0ng en0ty;
+ book name;
+ date, month, year of seGng up the book;
+ date, month, year of the closing book;
+ signatures of the book-maker, chief accountant and the legal
representa0ve of the accoun0ng en0ty;
+ number of pages;
+ seal hybrid border.

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 ACCOUNTING BOOKS
• The contents of an accoun0ng book include:
+ Date of book entry;

+ Number and date of the accoun0ng document used as a

basis for book entry;
+ Explana0on of business transac0ons;

+ Amounts of business transac0ons are recorded in accoun0ng

accounts;

+ Beginning balance , subtotal of arising amount in the period,

Closing balance .

• Electronic accoun0ng books means must comply with the above

regula0ons on form and content.
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 ACCOUNTING BOOKS (GENERAL JOURNAL FORM)

• JOURNAL

• GENERAL LEDGER

• SUBSIDIARY LEDGER

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 THE JOURNAL
• A day-by-day listing of transactions
• Purpose: To provide a record of all transactions
completed by the business
• Commonly referred to as a book of original
entry
• The act of entering transactions in a journal is
called journalizing

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 THE JOURNAL
Journal is an accounting book used to record:
+ The business transactions in the
accounting period according to the chronological
order and reflect the accounting reciprocal
relationship of those transactions.
+ Includes:
• General journal
• Special journal

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THE GENERAL JOURNAL

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THE SPECIAL JOURNAL

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THE SPECIAL JOURNAL

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THE SPECIAL JOURNAL

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THE SPECIAL JOURNAL

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THE GENERAL LEDGER
• A complete set of all general accounts used by a
business
• Similar to T accounts
• Used to keep a complete record of the debits and
credits made to each general account as a result of
entries made in the journal
• Numbered and arranged in the same order as the chart
of accounts

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THE GENERAL LEDGER

21
THE GENERAL LEDGER

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THE GENERAL LEDGER

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SUBSIDIARY LEDGER
Subsidiary ledger is a type of book that records detailed data about a
general object reflected in the General Ledger.

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SUBSIDIARY LEDGER

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 RELATIONSHIP BETWEEN GENERAL LEDGER &
SUBSIDIARY LEDGER

• The data on the subsidiary ledgers has the effect of supplemen0ng,

explaining and clarifying the data on the general ledger.

• The business transac0ons is recorded simultaneously in the general

gedger and the subsidiary ledgers

• All of the amounts in the subsidiary ledgers must equal the amounts
in the general ledger account.

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RELATIONSHIP BETWEEN GENERAL LEDGER &
SUBSIDIARY LEDGER

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RECORDING PROCESS ACCORDING TO
GENERAL JOURNAL FORM

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 RECORDING ACCORDING TO
GENERAL JOURNAL FORM
Example 5.1: In February 20X1, An Nam company had the following
business transac0ons:
1/2: Owner invested by deposit to bank account, 500.
5/2: Purchased on account goods X from Minh Anh company, 250 .
7/2: Paid for Minh Anh company, 200 by bank loan.
10/2: Withdraw from bank account and transfer to cash on hand
50.
12/2: Owner withdrew from bank account, 300.
15/2: Purchased on account goods Y from Anh Hoa company, 120.

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 JOURNALIZING - EXAMPLE

• Owner invested 500 in the business by deposit to bank

account on Feb 1, 20X1.

GENERAL JOURNAL

20X1
Date Document Description Post Line Account Amount
Ref. No. Number
No. Date Debit Credit

xxx xxx

1/2/20X1 GBC01 1/2/20X1

Step #1 Page 2
Enter the date of recording;
Number & Date of accounting
document
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 JOURNALIZING - EXAMPLE

GENERAL JOURNAL

20X1
Date Document Description Post Line Account Amount
Ref. No. Number
No. Date Debit Credit

xxx xxx

1/2/20X1 GBC01 1/2/20X1 Owner’s original

investment in
business

Page 2

Step #2
ENTER THE EXPLANATION of the
business transaction
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 JOURNALIZING - EXAMPLE

GENERAL JOURNAL

20X1
Date Document Description Post Line Account Amount
Ref. No. Number
No. Date Debit Credit

xxx xxx

1/2/20X1 GBC01 1/2/20X1 Owner’s original 112 500

investment in
business

Page 2

Step #3
ENTER THE ACCOUNT NUMBER &
THE AMOUNT OF THE DEBIT

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 JOURNALIZING - EXAMPLE

GENERAL JOURNAL

20X1
Date Document Description Post Line Account Amount
Ref. No. Number
No. Date Debit Credit

xxx xxx

1/2/20X1 GBC01 1/2/20X1 Owner’s original 112 500

investment in
business 411 500

Page 2

Step #4
ENTER THE ACCOUNT NUMBER &
THE AMOUNT OF THE CREDIT

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 JOURNALIZING - EXAMPLE

GENERAL JOURNAL

20X1
Date Document Description Post Line Account Amount
Ref. No. Number
No. Date Debit Credit

xxx xxx

1/2/20X1 GBC01 1/2/20X1 Owner’s original 1 112 500

investment in
business 2 411 500

Page 2

Step #5
ENTER THE LINE NUMBER

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 JOURNALIZING - EXAMPLE

GENERAL JOURNAL

20X1
Date Document Description Post Line Account Amount
Ref. No. Number
No. Date Debit Credit

xxx xxx

1/2/20X1 GBC01 1/2/20X1 Owner’s original √ 1 112 500

investment in
business √ 2 411 500

Page 2

Step #6
When the data from the general
journal is transferred to the general
ledger, the accountant will tick
column Post Ref.
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PosOng To The General Ledger
• The process of copying debits and credits from the
journal to the ledger accounts

• Done daily or at frequent intervals

• Five-step process

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PosOng To The General Ledger
GENERAL JOURNAL
20X1
Date Document Description Post Line Account Amount
Ref. No. Number
No. Date Debit Credit

xxx xxx
1/2/20X1 GBC01 1/2/20X1 Owner’s original 1 112 500
investment in
business 2 411 500
Page 2

GENERAL LEDGER
20X1
Account Name: Cash in bank Account No. 112
Date Document Description General Ledger Account Amount
No.
No. Date Page Line Debit Credit
No. No.
Beginning Balance 120
PosOng To The General Ledger
GENERAL JOURNAL
20X1
Date Document Description Post Line Account Amount
Ref. No. Number
No. Date Debit Credit

xxx xxx
1/2/20X1 GBC01 1/2/20X1 Owner’s original 1 112 500
investment in
business 2 411 500
Page 2

GENERAL LEDGER
20X1
Account Name: Cash in bank Account No. 112
Date Document Description General Ledger Account Amount
No.

No. Date Page Line Debit Credit

No. No.

Beginning Balance 120

1/2/20X1 GBC01 1/2/20X1

PosOng To The General Ledger
GENERAL JOURNAL
20X1
Date Document Description Post Line Account Amount
Ref. No. Number
No. Date Debit Credit

xxx xxx
1/2/20X1 GBC01 1/2/20X1 Owner’s original 1 112 500
investment in
business 2 411 500
Page 2

GENERAL LEDGER
20X1
Account Name: Cash in bank Account No. 112
Date Document Description General Ledger Account Amount
No.

No. Date Page Line Debit Credit

No. No.

Beginning Balance 120

1/2/20X1 GBC01 1/2/20X1 Owner’s original

investment in business
PosOng To The General Ledger
GENERAL JOURNAL
20X1
Date Document Description Post Line Account Amount
Ref. No. Number
No. Date Debit Credit

xxx xxx
1/2/20X1 GBC01 1/2/20X1 Owner’s original 1 112 500
investment in
business 2 411 500
Page 2

GENERAL LEDGER
20X1
Account Name: Cash in bank Account No. 112
Date Document Description General Ledger Account Amount
No.

No. Date Page Line Debit Credit

No. No.

Beginning Balance 120

1/2/20X1 GBC01 1/2/20X1 Owner’s original 2

investment in business
PosOng To The General Ledger
GENERAL JOURNAL
20X1
Date Document Description Post Line Account Amount
Ref. No. Number
No. Date Debit Credit

xxx xxx
1/2/20X1 GBC01 1/2/20X1 Owner’s original 1 112 500
investment in
business 2 411 500
Page 2

GENERAL LEDGER
20X1
Account Name: Cash in bank Account No. 112
Date Document Description General Ledger Account Amount
No.

No. Date Page Line Debit Credit

No. No.

Beginning Balance 120

1/2/20X1 GBC01 1/2/20X1 Owner’s original 2

investment in business 1
PosOng To The General Ledger
GENERAL JOURNAL
20X1
Date Document Description Post Line Account Amount
Ref. No. Number
No. Date Debit Credit

xxx xxx
1/2/20X1 GBC01 1/2/20X1 Owner’s original 1 112 500
investment in
business 2 411 500
Page 2

GENERAL LEDGER
20X1
Account Name: Cash in bank Account No. 112
Date Document Description General Ledger Account Amount
No.

No. Date Page Line Debit Credit

No. No.

Beginning Balance 120

1/2/20X1 GBC01 1/2/20X1 Owner’s original 2 1

investment in business 411
PosOng To The General Ledger
GENERAL JOURNAL
20X1
Date Document Description Post Line Account Amount
Ref. No. Number
No. Date Debit Credit

xxx xxx
1/2/20X1 GBC01 1/2/20X1 Owner’s original 1 112 500
investment in
business 2 411 500
Page 2

GENERAL LEDGER
20X1
Account Name: Cash in bank Account No. 112
Date Document Description General Ledger Account Amount
No.

No. Date Page Line Debit Credit

No. No.

Beginning Balance 120

1/2/20X1 GBC01 1/2/20X1 Owner’s original 2 1

investment in business 411 500
PosOng To The General Ledger
GENERAL LEDGER
20X1
Account Name: Cash in bank Account No. 112
Date Document Description General Ledger Account Amount
No.

No. Date Page Line Debit Credit

No. No.

Opening Balance 120

1/2/20X1 GBC01 1/2/20X1 Owner’s original 2 1 411 500
investment in business

10/2/20X1 UNC02 10/2/20X1 Withdraw from bank 2 8 111 50

account and transfer to
cash on hand
12/2/20X1 UNC03 12/2/20X1 Owner withdrew from 2 10 411 300
bank account

Subtotal 500 350

Closing balance 270

 SUBSIDIARY LEDGER
SUBSIDIARY LEDGER OF GOODS
20X1
Account No. 156
Warehouse Name: N Name of Goods : X

Document Purchases Cost of goods sold Balance

Acc.
Descrip0on
No. Unit Total Unit Total Unit Total
No. Date Quan0ty Quan0ty Quan0ty
price amount price amount price amount

Openning
15 150
Balance

PNK01 5/2/20X1 Purchased X 331 25 10 250 40 10 400

Subtotal x 25 250 40 400

 DETAILED SUMMARY TABLE
A detailed summary table is made to compare and check the data recorded
in the subsidiary ledgers of a general ledger, based on the rela0onship: the
total data on the subsidiary ledgers must be equal to the data on the
respec0ve general ledger .

DETAILED SUMMARY TABLE OF GOODS

Account: 156 Feb 20X1

Amount
# Name of goods Beginning Ending
Purchases COGS
balance balance
1 X 150 250 0 400
2 Y 50 120 0 170
Total 200 370 0 570

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 TRIAL BALANCE

Trial balance is a summary table of data of all general

ledgers used in the accoun0ng period of the en0ty,
including such data as: opening balance, arising
amount in the period, ending balance ,
compare and check the data recorded on the
general accounts.
 TRIAL BALANCE
GENERAL LEDGER
20X1
Account Name: Cash in bank Account No. 112
Date Document Description General Ledger Account Amount
No.
No. Date Page No. Line Debit Credit
No.
Opening Balance 120
1/2/20X1 GBC01 1/2/20X1 Owner’s original investment 2 1 411 500
in business
10/2/20X1 UNC02 10/2/20X1 Withdraw from bank account 2 8 111 50
and transfer to cash on hand
12/2/20X1 UNC03 12/2/20X1 Owner withdrew from bank 2 10 411 300
account
Subtotal 500 350

Ending balance 270

Account name Opening Balance Arising amount Ending balance

Debit Credit Debit Credit Debit Credit

Cash in bank 120 500 350 270

Total 345 345 1.420 1.420 915 915