Chapter 12: Chapter 12: Accounts ReceivableAccounts Receivable

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

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Software Objectives, p. 421Software Objectives, p. 421

Set up customer default information.Set up customer default information.Set up sales tax information.Set up sales tax information.Set up customer maintenance information.Set up customer maintenance information.Record credit sales, cash sales, and sales Record credit sales, cash sales, and sales returns.returns.Record customer receipts, partial payments, and Record customer receipts, partial payments, and edit invoices.edit invoices.

Make four backups: 1) back up Chapter 12 Make four backups: 1) back up Chapter 12 beginning data; 2) back up Chapter 12 data; 3) beginning data; 2) back up Chapter 12 data; 3) back up Exercise 12-1; 4) back up Exercise 12-back up Exercise 12-1; 4) back up Exercise 12-2.2.

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Web Objectives, p. 421 Web Objectives, p. 421 Use your Internet browser to go to the book’s Use your Internet browser to go to the book’s website at website at www.mhhe.com/yacht2005www.mhhe.com/yacht2005

Go to the Internet Activity link on the book’s Go to the Internet Activity link on the book’s website. Then, select WEB EXERCISES PART website. Then, select WEB EXERCISES PART 3. Complete the second web exercise in Part 3—3. Complete the second web exercise in Part 3—WebCPA: Tools and Resources for the WebCPA: Tools and Resources for the Electronic Accountant. Electronic Accountant. Use a word processing program to write Use a word processing program to write summaries of the websites that you visited.summaries of the websites that you visited.

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Peachtree’s Accounts Receivable Peachtree’s Accounts Receivable System, p. 422System, 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 TipsPeachtree Tips

You You mustmust complete Chapter 11 before you complete Chapter 11 before you start Chapter 12. start Chapter 12.

If the general ledger account (GL account If the general ledger account (GL account column) is not displayed on the column) is not displayed on the Sales/Invoicing window, check the global Sales/Invoicing window, check the global options. In the Hide General Ledger options. In the Hide General Ledger Accounts section, all boxes must be Accounts section, all boxes must be unchecked (see p. 54, steps 1-4).unchecked (see p. 54, steps 1-4).

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Backing Up Chapter 12Backing Up Chapter 12

Backup Name Backup Name

KilobytesKilobytes Page Nos.Page Nos.

Chapter 12 BeginChapter 12 Begin 248 KB248 KB 430-431430-431

Chapter 12Chapter 12 257 KB257 KB 458-459458-459

Exercise 12-1Exercise 12-1 241 KB241 KB 465465

Exercise 12-2Exercise 12-2 246 KB246 KB 466466

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\Peachtree\company\[shortened company name]. You can also specific a hard drive location, or back up to external media such as a floppy disk, Zip disk, CD-R, or USB drive. The chart for the size of all the backups made in Part 3 (Chapters 11-14) is shown on page 362.

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Chapter 12 TopicsChapter 12 Topics1.1. Software & web objectives, p. 421Software & web objectives, p. 4212.2. Getting started, p. 422-423Getting started, p. 422-423

a. Setting up customer defaults, pp. 424a. Setting up customer defaults, pp. 424b. Setting up tax defaults, pp. 425-427b. Setting up tax defaults, pp. 425-427c. Setting up customer maintenance information,c. Setting up customer maintenance information,

pp. 427-430pp. 427-4303.3. Backing up your data, p. 430-431Backing up your data, p. 430-4314.4. Recording sales, pp. 431-432Recording sales, pp. 431-432

a. Entering invoices for credit sales, pp. 432-433a. Entering invoices for credit sales, pp. 432-433b. Printing the sales invoice, pp. 433-438b. Printing the sales invoice, pp. 433-438c. Entering a service invoice, pp. 439-441c. Entering a service invoice, pp. 439-441d. Sales returns: Tasks; Credit Memos, pp. 442-d. Sales returns: Tasks; Credit Memos, pp. 442-

444.444.

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Chapter 12 Topics (continued)Chapter 12 Topics (continued)

5.5. Recording receipts and cash sales, pp. 445Recording receipts and cash sales, pp. 445a. Entering a receipt, pp. 445-448a. Entering a receipt, pp. 445-448b. Cash sales, pp. 448-449b. Cash sales, pp. 448-449c. Finance charges, p. 450c. Finance charges, p. 450

6.6. Printing customer forms, p. 450Printing customer forms, p. 450a. Printing invoices, p. 450a. Printing invoices, p. 450b. Printing statements, p. 451b. Printing statements, p. 451c. Printing mailing labels, pp. 451-452c. Printing mailing labels, pp. 451-452d. Preparing collection letters, pp. 442-454d. Preparing collection letters, pp. 442-454

7.7. Printing the sales journal, pp. 454-455Printing the sales journal, pp. 454-455

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Chapter 12 Topics (concluded)Chapter 12 Topics (concluded)8.8. Printing the cash receipts journal, p. 455-456Printing the cash receipts journal, p. 455-4569.9. Printing customer ledgers, p. 456-457Printing customer ledgers, p. 456-45710.10. Printing the general ledger trial balance, pp. 457Printing the general ledger trial balance, pp. 45711.11. Editing receipts, pp. 458Editing receipts, pp. 45812.12. Backing up Chapter 12 data, pp. 458-459Backing up Chapter 12 data, pp. 458-45913.13. Internet activity, p. 459Internet activity, p. 45914.14. Summary and review, pp. 459-460Summary and review, pp. 459-460

a.a. Going to the net, p. 460Going to the net, p. 460b.b. Multiple-choice questions, pp. 460-463Multiple-choice questions, pp. 460-463c. Exercise 12-1, pp. 463-465c. Exercise 12-1, pp. 463-465d. Exercise 12-2, pp. 465-466d. Exercise 12-2, pp. 465-466e. Chapter 12 index, p. 467e. Chapter 12 index, p. 467

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

Click on <OK>.Click on <OK>.

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Setting up sales tax defaults, p. 425-426Setting up sales tax defaults, p. 425-426

Read the instructions on page 425. Then, complete steps 1 – Read the instructions on page 425. Then, complete steps 1 – 6 on p. 425 for setting up sales tax defaults. This window is 6 on p. 425 for setting up sales tax defaults. This window is shown on p. 426.shown on p. 426.

Click on Click on SSave. Click Close to return to the menu bar.ave. Click Close to return to the menu bar.

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

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

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Maintain Customers/Prospects, p. 428Maintain Customers/Prospects, p. 428

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

Click on the SaClick on the Salles Defaults tab.es Defaults tab.

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Sales defaults, p. 428-429Sales defaults, p. 428-429After selecting the SaAfter selecting the Salles Defaults tab (step 3), complete es Defaults tab (step 3), complete step 4 on p. 428. This window is shown on p. 428.step 4 on p. 428. This window is shown on p. 428.

Click on Click on SSave. Then, continue adding customers. ave. Then, continue adding customers. Complete step 6 on pages 429-430.Complete step 6 on pages 429-430.

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Backing up your data, p. 430-431Backing up your data, p. 430-431

Complete steps 1 – 6 to back up your Complete steps 1 – 6 to back up your data.data.

Use Use Chapter 12 BeginChapter 12 Begin as the back up as the back up name.name.

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

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

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Print Forms: Invoices/Pkg. Slips, p. 433-434Print Forms: Invoices/Pkg. Slips, p. 433-434

To print the sales invoice, follow steps 1, 2, and 3 on pages 433 and 434. To print the sales invoice, follow steps 1, 2, and 3 on pages 433 and 434. Make sure that Invoice Plain Service #2 is highlighted. Make sure that Invoice Plain Service #2 is highlighted.

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

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Print Forms: Invoices, pp. 434-435Print Forms: Invoices, pp. 434-435

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

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Printing sales invoices, pp. 436-438Printing sales invoices, pp. 436-438

Continue entering sales to customers on Continue entering sales to customers on pages 436-438.pages 436-438.

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

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Entering a service invoice, pp. 439-441Entering a service invoice, pp. 439-441

Read the information about service Read the information about service invoices on page 439.invoices on page 439.

Complete steps 1 – 7 on page 439Complete steps 1 – 7 on page 439

Compare your invoice to the one shown Compare your invoice to the one shown on p. 441.on p. 441.

Complete step 9 on p. 441.Complete step 9 on p. 441.

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Sales returns, pp. 442-443Sales returns, pp. 442-443Read the information about sales returns on p. 442. Complete Read the information about sales returns on p. 442. Complete steps 1 – 7 on p. 442. This Credit Memos window is shown on p. steps 1 – 7 on p. 442. This Credit Memos window is shown on p. 443.443.

Click on Click on SSave to post. Then, close. Complete steps 1-6 to apply a ave to post. Then, close. Complete steps 1-6 to apply a sales return, pp. 443-444.sales return, pp. 443-444.

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

Click on Click on SSave to post, then click on the Close icon.ave to post, then click on the Close icon.

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

Click on Click on SSave to post. ave to post.

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

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

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Enter cash sales, pp. 448-449Enter cash sales, pp. 448-449

Read the information about cash sales on Read the information about cash sales on p. 448.p. 448.

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

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Receipts window for cash sale, p. 449Receipts window for cash sale, p. 449

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Printing customer forms, pp. 450-453Printing customer forms, pp. 450-453

Read the information on pages 450-453.Read the information on pages 450-453.

Complete steps 1 and 2 on page 453.Complete steps 1 and 2 on page 453.

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

Complete steps 3 – 8 on page 454.Complete steps 3 – 8 on page 454.

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Printing the sales journal, Printing the sales journal, pp. 454-455pp. 454-455

Complete steps 1 – 4 on pp. 454-455Complete steps 1 – 4 on pp. 454-455

Compare your sales journal to the one Compare your sales journal to the one shown on p. 455.shown on p. 455.

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Printing the cash receipts Printing the cash receipts journal, p. 455-456journal, p. 455-456

Complete steps 1 – 3 on pp. 455-456Complete steps 1 – 3 on pp. 455-456

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

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Printing the customer ledgers, Printing the customer ledgers, pp. 455-457pp. 455-457

Complete steps 1 and 2 on page 456.Complete steps 1 and 2 on page 456.

Compare your printout of the customer Compare your printout of the customer ledgers to the one shown on p. 457.ledgers to the one shown on p. 457.

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Printing the general ledger trial Printing the general ledger trial balance, p. 457-458balance, p. 457-458

Complete steps 1 and 2 on page 457.Complete steps 1 and 2 on page 457.

Compare your general ledger trial balance Compare your general ledger trial balance to the one shown on p. 457.to the one shown on p. 457.

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Editing receipts, pp. 458Editing receipts, pp. 458

Click on Tasks; Receipts, Abc Open icon. Highlight Click on Tasks; Receipts, Abc Open icon. Highlight Invoice 104, Jane Porter.Invoice 104, Jane Porter.

Click on <Click on <OOK>. The Receipts window appears with K>. The Receipts window appears with Jane Porter’s partial payment of $95.Jane Porter’s partial payment of $95.

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Backing Up Chapter 12 Data, Backing Up Chapter 12 Data, pp. 458-459pp. 458-459

Complete steps 1 - 6 on pages 458-459.Complete steps 1 - 6 on pages 458-459.The back up name is The back up name is Chapter 12Chapter 12..

Click on <Click on <OOk>. Compare your check to the one shown on p. 381. Record the additional payments shown on p. k>. Compare your check to the one shown on p. 381. Record the additional payments shown on p. 382. 382.

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Glossary of TermsGlossary of TermsChapter 12Chapter 12

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Accounts receivable, p. 422Accounts receivable, p. 422

Money that is owed by customers to the Money that is owed by customers to the business.business.

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Accounts Receivable transactions, p. 422Accounts Receivable transactions, p. 422

Credit transactions from customers.Credit transactions from customers.

When Richard’s Sales and Service sells When Richard’s Sales and Service sells merchandise on account to customers, the merchandise on account to customers, the transactions are known as accounts transactions are known as accounts receivable transactions.receivable transactions.

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Invoice, p. 422Invoice, p. 422

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

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Cash Receipts Journal, p. 431Cash Receipts Journal, p. 431

A journal used to record all inflows of A journal used to record all inflows of cash. cash.

Peachtree takes the necessary information Peachtree takes the necessary information from the Receipts window and from the Receipts window and automatically journalizes the transactions automatically journalizes the transactions in the cash receipts journal.in the cash receipts journal.

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Sales journal, p. 431Sales journal, p. 431 Sales on account are recorded in the Sales on account are recorded in the sales journal.sales journal.

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

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Customer ledger, p. 432Customer ledger, p. 432

The customer ledger shows account The customer ledger shows account activity for each customer.activity for each customer.

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Accounts receivable ledger, p. 432Accounts receivable ledger, p. 432

The accounts receivable ledger shows the The accounts receivable ledger shows the account activity for each customer. account activity for each customer.

In Peachtree, this is called the customer In Peachtree, this is called the customer ledger.ledger.

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Service invoice, p. 439Service invoice, p. 439An alternative to the standard invoice. An alternative to the standard invoice. Use it when you want to create an Use it when you want to create an invoice without inventory items.invoice without inventory items.

Matt's Service Merchandise sells and Matt's Service Merchandise sells and repairs household items. When repairs repairs household items. When repairs are done, a service invoice is used.are done, a service invoice is used.

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11 Go to the book’s website at Go to the book’s website at www.mhhe.com/yacht2005www.mhhe.com/yacht2005

22 In the Student Center list, link to Internet Activities.In the Student Center list, link to Internet Activities.

33 Link to WEB EXERCISES PART 3.Link to WEB EXERCISES PART 3.

44 Complete the WebCPA—Tools and Resources for Complete the WebCPA—Tools and Resources for Electronic Accountant exercise. Read steps 1-3.Electronic Accountant exercise. Read steps 1-3.

55 Follow the steps shown on the book’s website to complete Follow the steps shown on the book’s website to complete this Internet activity.this Internet activity.

66 Using a word processing program, write a brief summary Using a word processing program, write a brief summary of what you find. Include all appropriate website of what you find. Include all appropriate website addresses.addresses.

Internet Activity, p. 459Internet Activity, p. 459

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Going to the Net, p. 460Going to the Net, p. 460Access the Business Owner’s Toolkit website Access the Business Owner’s Toolkit website at at www.toolkit.cch.com/text/P06_1430.aspwww.toolkit.cch.com/text/P06_1430.aspRead the accounts receivable page.Read the accounts receivable page.

1.1. What is the common abbreviation for What is the common abbreviation for accounts receivable?accounts receivable?

2.2. What is the control account for customer What is the control account for customer sales on account?sales on account?

3.3. How is the ending accounts receivable total How is the ending accounts receivable total computed?computed?