Chapter 12:

Accounts Receivable
 Accounts Receivable
In Chapter 11, you learned how to use Peachtree’s
Purchases/Receive Inventory and Payments tasks.
Now that you have purchased merchandise from
vendors, you are ready to sell that merchandise.
To do that, you need to learn how to use
Peachtree’s Sales/Invoicing task.
Before you can use the Sales/Invoicing task, you
need to set up customer defaults, sales tax
information, and customer maintenance
information. After you set these defaults,
Peachtree will use this information when you
record a sale.

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 Software Objectives, p. 421
Set up customer default information.
Set up sales tax information.
Set up customer maintenance information.
Record credit sales, cash sales, and sales
returns.
Record customer receipts, partial payments, and
edit invoices.
Make four backups: 1) back up Chapter 12
beginning data; 2) back up Chapter 12 data; 3)
back up Exercise 12-1; 4) back up Exercise 12-2.

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 Web Objectives, p. 421
Use your Internet browser to go to the book’s
website at www.mhhe.com/yacht2006.
Go to the Internet Activity link on the book’s
website. Then, select WEB EXERCISES PART
3. Complete the second web exercise in Part
3–WebCPA: Tools and Resources for the
Electronic Accountant.
Use a word processing program to write
summaries of the websites that you visited.

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 Peachtree’s Accounts Receivable
System, p. 422

Print and send an invoice to your customer.

The customer sends you a check to pay the bill.

Select the invoice that applies to the customer's check,

then select the Pay box.

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 Peachtree Tips

You must complete Chapter 11 before you

start Chapter 12.
If the general ledger account (GL account
column) is not displayed on the
Sales/Invoicing window, check the global
options. In the Hide General Ledger
Accounts section, all boxes must be
unchecked (see Chapter 2, p. 56, steps 1-4).

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 Backing Up Chapter 12
The chart below shows the size of the backups made in Chapter 12. The textbook
steps show you how to back up to Peachtree’s default hard drive location at
C:\Program Files\Sage Software\Peachtree\company\[shortened company name].
You can also specify a hard drive location, or back up to external media such as a
floppy disk, Zip disk, CD-R, or USB media. The chart for the size of all the
backups made in Part 3 (Chapters 11-14) is shown on page 362.

Backup Name Kilobytes Page Nos.

Chapter 12 Begin 307 KB 430-431

Chapter 12 322 KB 458-459
Exercise 12-1 297 KB 465
Exercise 12-2 310 KB 466
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 Chapter 12 Topics
1. Software & web objectives, p. 421
2. Getting started, p. 422-423
a. Setting up customer defaults, pp. 424
b. Setting up tax defaults, pp. 425-427
c. Setting up customer maintenance information,
pp. 427-430
3. Backing up your data, p. 430-431
4. Recording sales, pp. 431-432
a. Entering invoices for credit sales, pp. 432-433
b. Printing the sales invoice, pp. 433-438
c. Entering a service invoice, pp. 439-441
d. Sales returns: Tasks; Credit Memos, pp. 442-
444.

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 Chapter 12 Topics (continued)
4. Recording receipts and cash sales, pp. 445
a. Entering a receipt, pp. 445-448
b. Cash sales, pp. 448-449
c. Finance charges, p. 450
5. Printing customer forms, p. 450
a. Printing invoices, p. 450
b. Printing statements, p. 451
c. Printing mailing labels, pp. 451-452
d. Preparing collection letters, pp. 442-454
6. Printing the sales journal, pp. 454-455

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 Chapter 12 Topics (concluded)
7. Printing the cash receipts journal, p. 455-456
8. Printing customer ledgers, p. 456-457
9. Printing the general ledger trial balance, pp. 457
10. Editing receipts, pp. 458
11. Backing up Chapter 12 data, pp. 458-459
12. Internet activity, p. 459
13. Summary and review, pp. 459-460
a. Going to the net, p. 460
b. Multiple-choice questions, pp. 460-463
c. Exercise 12-1, pp. 463-465
d. Exercise 12-2, pp. 465-466
e. Chapter 12 index, p. 467

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 Getting started, pp. 422-423
Complete steps 1 – 2h. on p. 422-423. Then, complete steps 1 -
6 for setting up customer defaults on p. 424. The Customer
Defaults window is shown on p. 424.

Click on <OK>.

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 Setting up sales tax defaults, p. 425-426
Read the instructions on page 425. Then, complete steps 1 – 6
on p. 425 for setting up sales tax defaults. The Maintain Sales
Tax Authorities window is shown on p. 426.

Click on Save. Click Close to return to the menu bar.

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 Maintain sales tax codes, p. 427
Complete the steps 1-5 on pp. 426-427.

Click on Close to return to the menu bar.

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 Maintain Customers/Prospects, p. 428
Click on Maintain; Customers/Prospects.
Type the customer information shown in step 2 on pp. 427-428

Click on the Sales Defaults tab.

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 Sales defaults, p. 428-429
After selecting the Sales Defaults tab (step 3), complete step
4 on p. 428. The Maintain Customers/Prospects window is
shown on p. 428.

Click on Save. Then, continue adding customers. Complete

step 6 on pages 429-430.

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 Backing up your data, p. 430-431
Complete steps 1 – 6 to back up your
data.
Use Chapter 12 Begin as the back up
name.

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 Recording sales, p. 431-433
Read the information on pp. 431-433. Then, complete steps 1- 7 on pp. 432-433 for entering invoices for
credit sales. The Sales/Invoicing window is shown on p. 433.

Continue with steps 4 – 5.m. on pp. 365 and 366.

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 Print Forms: Invoices/Pkg. Slips, p. 433-434
To print the sales invoice, follow steps 1, 2, and 3 on pages 433 and 434.
Make sure that Invoice is highlighted.

Click on <OK>. Read step 5 on page 434.

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 Print Forms: Invoices, pp. 434-435
After completing steps 5 and 6 on p. 434, Invoice
Number 101 starts to print. Compare your sales
invoice to the one shown on page 435.

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 Printing sales invoices, pp. 436-438

Continue entering sales to customers on

pages 436-438.
Print your sales invoices. Compare them
with the ones shown on pages 436-438.

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Entering a service invoice, pp. 439-441

Read the information about service

invoices on page 439.
Complete steps 1 – 7 on page 439
Compare your invoice to the one shown
on p. 441.
Complete step 9 on p. 441.

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 Sales returns, pp. 442-443
Read the information about sales returns on p. 442. Complete steps
1 – 7 on p. 442. The Credit Memos window is shown on p. 443.

Click on Save to post. Then, close. Complete steps 1-6 to apply a

sales return, pp. 443-444.

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 Receipts window, p. 444
After completing steps 5 and 6 on pp. 443-444, the Receipts
window appears.

Click on Save to post, then click on the Close icon.

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 Entering a receipt, pp. 445 – 446
Read page 445. Then, complete steps 1 – 6 on p. 445. The
Receipts window is shown on p. 446.

Click on Save to post.

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 Partial payment, pp. 446-447
Complete steps 1 – 5 on p. 446-447.

Click on Save to post (this is step 6 on p. 447).

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 Enter cash sales, pp. 448-449

Read the information about cash sales on

p. 448.
Complete steps 1- 10 on pages 448 and
449 to enter cash sales.

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 Receipts window for cash sale, p. 449

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 Printing customer forms, pp. 450-453

Read the information on pages 450-453.

Complete steps 1 and 2 on page 453.

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 Collection Manager window, p. 453
After completing step 2 on page 453, the Collection Manager
window appears.

Complete steps 3 – 8 on page 454.

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 Printing the sales journal,
pp. 454-455
Complete steps 1 – 4 on pp. 454-455
Compare your sales journal to the one
shown on p. 455.

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 Printing the cash receipts
journal, p. 455-456

Complete steps 1 – 3 on pp. 455-456

Compare your cash receipts journal to the
one shown on p. 456.

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 Printing the customer ledgers,
pp. 455-457
Complete steps 1 and 2 on page 456.
Compare your printout of the customer
ledgers to the one shown on p. 457.

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 Printing the general ledger trial
balance, p. 457
Complete steps 1 and 2 on page 457.
Compare your general ledger trial balance
to the one shown on p. 457.

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 Editing receipts, pp. 458
Click on Tasks; Receipts, Abc Open icon. Highlight
Invoice 104, Judith Plant.

Click on <OK>. The Receipts window appears with

Judith Plant’s partial payment of $105.

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 Backing Up Chapter 12 Data,
pp. 458-459

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 Glossary of Terms
Chapter 12

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 Accounts receivable, p. 422
Money that is owed by customers to the
business.

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 Accounts Receivable transactions, p. 422

Credit transactions from customers.

When Jessica’s Service Merchandise sells
merchandise on account to customers, the
transactions are known as accounts
receivable transactions.

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 Invoice, p. 422
A bill that shows an itemized list of goods
shipped or services rendered, stating
quantities, prices, fees, and shipping
charges.

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Cash Receipts Journal, p. 431
A journal used to record all inflows of
cash.
Peachtree takes the necessary information
from the Receipts window and
automatically journalizes the transactions
in the cash receipts journal.

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 Sales journal, p. 431
Sales on account are recorded in the
sales journal.
In Peachtree, all the information about a
sale is recorded in the Sales/Invoicing
window. Then, Peachtree takes the
necessary information from this window
and automatically journalizes the
transaction in the sales journal.

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 Customer ledger, p. 432
The customer ledger shows account
activity for each customer.

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 Accounts receivable ledger, p. 432

The accounts receivable ledger shows the

account activity for each customer.
In Peachtree, this is called the customer
ledger.

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 Service invoice, p. 439
An alternative to the standard invoice.
Use it when you want to create an
invoice without inventory items.
Matt's Service Merchandise sells and
repairs household items. When repairs
are done, a service invoice is used.

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 Internet Activity, p. 459
1 Go to the book’s website at www.mhhe.com/yacht2006.

2 Link to Student Edition.

3 In the Course-wide Content list, link to Part 3 Internet Activities
for Chapters 11-14. Open or Save. (You can also choose
Chapter 12, then link to Internet Activities. If you Choose a
Chapter, observe that other chapter-specific links are available;
for example, Quizzes, PowerPoints, and Going to the Net
Exercises.) .
4 Complete the WebCPA–Tools and Resources for the
Electronic Accountant exercise. Read steps 1–3.
5 Follow the steps shown on the book’s website to complete
this Internet activity.
6 Using a word processing program, write a brief summary
of what you find. Include all appropriate website
addresses.
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 Going to the Net, p. 460
Access the Business Owner’s Toolkit website at
http://www.toolkit.cch.com/text/P06_1430.asp .
Read the accounts receivable page, and then
answer the following questions.
What is the common abbreviation for accounts
receivable?
What is the control account for customer sales
on account?
How is the ending accounts receivable total
computed?

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