Ask Experts Questions for FREE Help !
Ask
    arun737's Avatar
    arun737 Posts: 1, Reputation: 1
    New Member
     
    #1

    Aug 26, 2009, 05:55 AM
    Prepare a journal
    Can you tell me how to prepare a journal entry for this transaction.


    Vaccination - Cash
    Vaccination - Accounts
    Pet consultation - Account
    Pet consultation - Cash
    Desexing - Cash
    Receive Payment from Account Customers
    Additional cash contributed by owner
    morgaine300's Avatar
    morgaine300 Posts: 6,561, Reputation: 276
    Uber Member
     
    #2

    Aug 26, 2009, 02:53 PM

    I'm a little confused over what some of these are supposed to mean. I assume this is a vet clinic. :)

    Vaccination - Cash
    Vaccination - Accounts
    Like this. I can't tell if "vaccination - accounts" means the vaccination account, or whether you mean vaccinations on account.

    In a way it doesn't matter, because I think understanding the concept behind these general types of entries will do more good than these specific entries.

    All your vaccinations, exams, surgery, etc are all going to be your revenue accounts. Whether they are all individual accounts or lumped together in some way doesn't matter. You will record these as a credit into the appropriate revenue account at the time the service is done, whether they paid cash. If the service is done, you have earnings, and therefore you record the earnings. It doesn't matter if they paid cash or charged it.

    If they pay cash at the time of service, you then debit cash. If they do not pay at the time of service, you then debit Receivables (or Debtors or whatever you're calling that account). Even though you didn't get paid, you still do have an asset. A receivable is a promise to pay in the future which has a worth to you.

    The important thing to note is that you'll record the revenue whether they pay on the spot. It's the debit that may change.

    Later when they pay the bill, the original service is not involved because you have already recorded that. They are simply paying on their bill. So you debit the cash you get and you credit the receivable/debtor account because they no longer owe it.

    It doesn't matter between "vacinnations-cash" and "pet consulation - cash" -- those are both revenue for cash and are handled the same way. Learn one and you have them all.

    As for additional cash from the owner -- if you follow the concepts instead of trying to memorize individual things, you should already know what to do with the cash. Cash coming in is cash coming in. Makes no difference where it came from. What that affects is the credit, which is the capital account because it came from the owner.

Not your question? Ask your question View similar questions

 

Question Tools Search this Question
Search this Question:

Advanced Search

Add your answer here.


Check out some similar questions!

Prepare general journal enteries [ 2 Answers ]

:( Prepare general journal enteries to record events a. purchase raw materials for $65000 cash b. used raw materials Dept A 21760

Compute bonuses and prepare journal entries [ 2 Answers ]

Chris Anger is the president of Anger Company, and his brother, George Anger, is the vice president. Their compensation package includes bonuses of 5% for Chris Anger and 4% for George Anger of net income that exceeds $325,000. Net income for the year 2009 has just been computed to be $745,000. 1....


View more questions Search