ACC 179 | Updates in Management Accounting Part 1

Student Activity Sheet Module #3

Name: _________________________________________________________________ Class number: _______

Section: ____________ Schedule: ________________________________________ Date: ________________

Lesson Title: Review on Bookkeeping Skills 2 and Special Materials:

Journals
Lesson Objectives:
At the end of this module, the students should be able to: References:
1. Review the preparation of a trial balance
2. Revisit the crucial concept of accrual basis of accounting
3. Analyze the different Special Journals
4. Refresh on the voucher system

Productivity Tip:
“The only thing to do with good advice is to pass it on. It is never of any use to oneself.” - Oscar Wilde

A. LESSON PREVIEW/REVIEW
1) Introduction (2 mins)
Good Day! Hope you are all safe. As we continue our journey on reviewing basic accounting, we will
discuss the trial balance and special journals.

2) Activity 1: What I Know Chart, part 1 (3 mins)

What I Know Questions: What I Learned (Activity 4)
1. What is a trial balance?

2. Give two examples of special

journals and explain its use.

This document is the property of PHINMA EDUCATION

 ACC 179 | Updates in Management Accounting Part 1
Student Activity Sheet Module #3

Name: _________________________________________________________________ Class number: _______

Section: ____________ Schedule: ________________________________________ Date: ________________

B. MAIN LESSON
1) Activity 2: Content Notes (13 mins)
Review on T-accounts and the Ledger
As discussed last module, we use the T-accounts to analyze the different business transactions that
happened in the business during the period. The formal document of the T-accounts is the ledger. At
the end of the period, we determine the balance of each accounts.

The Trial Balance

A trial balance is a bookkeeping worksheet in which the balance of all ledgers are compiled into debit
and credit account column totals that are equal. A company prepares a trial balance periodically, usually
at the end of every reporting period. The general purpose of producing a trial balance is to ensure the
entries in a company's bookkeeping system are mathematically correct. Remember that in the double
entry system, a transaction has an effect in the debit side and the credit side. The Trial Balance should
yield the same amount in both debits and credits.

Sample:

Things you have to take note about making the trial balance:
• Make sure the debit side is equal to the debit side
• Adjusting entries are not yet included
• Post-closing adjustments are not yet included

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 ACC 179 | Updates in Management Accounting Part 1
Student Activity Sheet Module #3

Name: _________________________________________________________________ Class number: _______

Section: ____________ Schedule: ________________________________________ Date: ________________

Matching Principle
The matching principle states that expenses should be recognized (recorded) as they are incurred to
produce revenues. An expense is the outflow or using up of assets in the generation of revenue.
Using the trial balance example above, the carwash revenue that was incurred for the period used
supplies for the period (thus the matching supplies expense).

Accrual Basis of Accounting

The accrual basis of accounting recognizes revenues when earned (a product is sold or a service has
been performed), regardless of when cash is received. Expenses are recognized as incurred, whether
or not cash has been paid out. It is from this concept that adjusting entries are made, as there are
revenues that are recognized but no cash has been received and expenses are incurred with no cash
outflow yet.

Special Journals
Special journals are specialized lists of financial transaction records which accountants call journal
entries. In contrast to a general journal, each special journal records transactions of a specific type,
such as sales or purchases.

List of Special Journals:

• Sales Journal - a specialized accounting journal and it is also a prime entry book used in an
accounting system to keep track of the sales of items that customers(debtors) have purchased
on account by charging a receivable on the debit side of an accounts receivable account and
crediting revenue on the credit side.
• Cash Receipts Journal - is used to record all cash coming into the business
• Purchases Journal - the main entry book which is used to record credit transactions (credit
purchases) for resalable purposes.
• Cash Disbursement Journal - a detailed record of the cash payments made by a business
• General Journal - the book that entity firstly records all of the daily financial transactions in it

Voucher System
A voucher system is an internal control procedure in accounting to ensure that every disbursements or
payments made by the business are properly documented with supporting evidence such as invoices,
receipts, and so on; that goods and/or services are actually received from valid suppliers and/or
vendors; that the description or nature of payment is known and clear; that the cash disbursed is
authorized and approved; that the disbursement is controlled with voucher series number to ensure
completeness; and last but not the least, that any fraud or theft will be eliminated or minimized.

Voucher System Process:

This document is the property of PHINMA EDUCATION

 ACC 179 | Updates in Management Accounting Part 1
Student Activity Sheet Module #3

Name: _________________________________________________________________ Class number: _______

Section: ____________ Schedule: ________________________________________ Date: ________________

1. Identify the transactions due for payment

2. Collect supporting document, as proof
3. Prepare the voucher
4. Record and print voucher - When recording, identify the source of funds and the type of voucher
to be prepared: cash, check or petty cash voucher
5. Attach supporting documents - In the printed voucher, attach supporting documents such as the
vendor’s invoice, purchase order, and so on
6. Preparers Signature - Person assigned to prepare the voucher must write complete name, date
prepared and signature. Forward the signed voucher, with attached supporting document, for
review and approval.
7. Check and Approval - The voucher and supporting documents will be checked by the owner,
treasurer or any authorized person for verification of validity and completeness before approval.
Once voucher is approved, the approver will write complete name, date approved and signature.
It will then return the voucher with attached supporting document to the preparer for payment.
8. Cash Disbursement - Preparer can now release the cash for disbursement or payment. The
person receiving the cash must write complete name, date received and signature.
9. Vendor’s Proof of Payment - Preparer must follow-up the payee or vendor for official or collection
receipt, if applicable. Attach it to the voucher.
10. Filing and Safekeeping of Voucher - File the voucher and all supporting documents in a voucher
filing folder for safekeeping and future references. Arrange the vouchers in chronological order.

2) Activity 3: Skill-building Activities (with answer key) (18 mins + 2 mins checking)
Circle the letter of the best answer

1. Suppose the opening balance of machinery account is a debit balance of P 100,000. Within this
month, there is an acquisition of machinery by an equivalent settlement of P 400,000 debt amount.
Also, there is a sale of machinery to the sole proprietor at the cost price of P 20,000. What is the
opening balance of the machinery account the next month?
a. debit balance P 480,000
b. debit balance of P 500,000
c. credit balance of P 480,000
d. credit balance of P 500,000
2. Accrual concept states that revenues and expenses of the firm should be recorded on ________
instead of __________ .
a. accrual basis cash basis
b. accrual basis credit basis
c. cash basis accrual basis
d. credit basis cash basis

This document is the property of PHINMA EDUCATION

 ACC 179 | Updates in Management Accounting Part 1
Student Activity Sheet Module #3

Name: _________________________________________________________________ Class number: _______

Section: ____________ Schedule: ________________________________________ Date: ________________

3. Lorelei Corpuz entered into a one-year tenancy contract from March 1, 2017 to February 28, 2018.
The monthly rental was P 90,000. For the year ended December 31, 2017, Lorelei Corpuz paid P
1,080,000 for the contract and recorded it as rental expenses. The profit for the year ended
December 31, 2017 was?
a. overstated by P 900,000
b. overstated by P 180,000
c. understated by P 900,000
d. understated by P 180,000
4. Suppose an entity recorded an expense when it was paid, but the expense was incurred one year
before the payment date. Which of the following accounting principles has been violated?
a. consistency concept
b. historical cost concept
c. accrual concept
d. entity concept
5. The financial year of Divina Cayabyab ends on December 31 each year. On May 30, 2018, Divina
Cayabyab received an annual service fee of P 600,000 from a customer for a service commencing
on June 1. On December 31, 2018, _______________.
a. P 250,000 should be treated as unearned revenues
b. P 300,000 should be treated as unearned revenues
c. P 600,000 should be treated as unearned revenues
d. P 600,000 should be treated as revenues for the current financial year
6. If a P 2,500 adjustment for depreciation is omitted, which of the following financial statement errors
will occur?
a. assets will be understated
b. expenses will be overstated
c. owner’s equity will be overstated
d. profit will be understated
7. The amount of accrued but unpaid expenses at the end of the period is both an expense and
a. a deferral
b. a liability
c. an asset
d. an income
8. Accrued revenues
a. decrease assets
b. decrease liabilities
c. increase assets
d. increase liabilities

This document is the property of PHINMA EDUCATION

 ACC 179 | Updates in Management Accounting Part 1
Student Activity Sheet Module #3

Name: _________________________________________________________________ Class number: _______

Section: ____________ Schedule: ________________________________________ Date: ________________

9. Accrued expenses
a. decrease assets
b. decrease liabilities
c. increase assets
d. increase liabilities
10. The word “accrued” implies which of the following?
a. Money has been paid and the service has been provided.
b. Money has been paid but no service have been provided.
c. Money has been paid for a service to be performed during the next period.
d. Money has not been paid or received but the service has already been performed or rendered.

3) Activity 4: What I Know Chart, part 2 (2 mins)

It’s time to answer the questions in the “What I Know Chart” in Activity 2. Write your answers in the “What I
Learned” column. Let’s see your improvement!

4) Activity 5: Check for Understanding (5 mins)

Circle the letter of the best answer
1. The type of transaction that would appear in the sales journal would be a sale of
a. equipment for cash
b. equipment in exchange for a note
c. merchandise for cash
d. merchandise on account
2. The receipt of cash arising from a sales transaction would be recorded in the
a. cash payments journal
b. cash receipts journal
c. purchases journal
d. sales journal
3. The classification and normal balance of the sales discount account would be
a. contra revenue and debit
b. contra revenue and credit
c. expense and debit
d. revenue and credit
4. An item retailing for P 10,000, subject to a trade discount of 25%, is paid for within the discount
period on terms of 2/10, n/30. What is the amount of payment?
a. P 10,000
b. P 7,500
c. P 7,400
d. P 7,350

This document is the property of PHINMA EDUCATION

 ACC 179 | Updates in Management Accounting Part 1
Student Activity Sheet Module #3

Name: _________________________________________________________________ Class number: _______

Section: ____________ Schedule: ________________________________________ Date: ________________

5. Each time an entry is recorded in the purchases journal, the credit would be entered in the
a. accounts payable column
b. accounts receivable column
c. purchases column
d. supplies column
6. Which of the following items would be recorded in the purchases journal?
a. equipment purchased on account
b. merchandise purchased on account
c. supplies purchased on account
d. all of the above
7. The controlling account in the general ledger that summarizes the debits and credits to the
individual accounts in the customers’ ledger is called
a. accounts payable
b. accounts receivable
c. purchases
d. sales
8. Infrequent sales returns would be recorded in which journal?
a. cash payments
b. cash receipts
c. general
d. sales returns
9. The individual amounts in the accounts payable column of the purchases journal are posted to the
appropriate account in the
a. accounts payable ledger
b. accounts receivable ledger
c. general journal
d. general ledger
10. The controlling account in the general ledger that summarizes the individual accounts with creditors
in a subsidiary ledger is called
a. accounts payable
b. accounts receivable
c. purchases
d. sales returns and allowances

C. LESSON WRAP-UP
1) Activity 6: Thinking about Learning (5 mins)
Work tracker. Congratulations! You have finished the module for today! Shade the number of the module
that you finished.

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 ACC 179 | Updates in Management Accounting Part 1
Student Activity Sheet Module #3

Name: _________________________________________________________________ Class number: _______

Section: ____________ Schedule: ________________________________________ Date: ________________

First Period Second Period Third Period

1 2 3 4 5 6 7 8 9 1 1 1 1 1 1 1 1 1 1 2 2 2 2 2 2 2
0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6

How do you feel today?

I feel (unsatisfactory/satisfactory/excellent) because
_______________________________________________________________.

What are your challenges in learning the concepts in this module? If you do not have challenges, what is
your best learning for today?
_____________________________________________________________________________________________________________
_____________________________________________________________________________________________________________
__________________

What are the questions/thoughts you want to share to your teacher today?
_____________________________________________________________________________________________________________
_____________________________________________________________________________________________________________
__________________

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