What is a Sales Journal? Definition Meaning Example

the sales journal

When it comes to the sales industry, whether you’re an owner, a manager, or a sales rep, it’s important to keep track of what is selling, what is working, and why. This can also help you to create new marketing plans. This is a document sent to customers showing full details of goods returned by them. It is evidence that goods has been returned by credit customers. H – Credit Card – this is a payment that was made by credit card on the date range that is selected but the date of the order does not fall under the date range selected. This is for any order that is within the date range selected that has not received any type of payment.

D – Deposits Applied – this is when a payment for an order was processed before the date of the order. Then once the order date has occurred the system will automatically apply the deposit as a payment. Below are step by step instructions of the payment type found in the Sales Journal. Let’s say, we have a shop, where we are servicing and repairing bikes, and we have existing customers coming with their bikes and submit them for repair, and they pay in cash. If a purchase order was generated for a sales order, the purchase order number and purchase order required date are included. If the Enable Bill To Customer Reporting is selected in Accounts Receivable Options, the bill-to customer number and name is included on the journal. July 6 Paid shipping cost of $200 on merchandise sold on July 5.

Accounting Topics

All the sales on account for June are shown in this journal; cash sales are recorded in the cash receipts journal. Entries from the sales journal are posted to the accounts receivable subsidiary ledger and general ledger. We know that only credit sales are recorded in the cash daybook/ Journal. The sales against which immediate cash is paid or even customers pay a cheque or charge their credit card are not recorded in sales daybooks. All such sales are recorded in the relevant columns of the cash books. At the end of each month , the amount column of the sales journal is added and the total is posted as adebit to accounts receivable and a credit to the sales account in the general ledger. The DR Other column would be handled a little differently as you need to look to the account column to find out where these individual amounts should be posted.

In this case, we would post a $200 debit to merchandise inventory and a $300 debit to utility expense. Under the periodic inventory method, the July 6 shipping costs would go to a Transportation In account and the July 25 discount would go to Purchases Discounts. Just like the purchases journal, only credit sales are recorded when preparing a sales journal. On the other hand, assets sold in cash are recorded in the cash book and the sales of assets on credit are recorded in the proper journal.


If a general journal is used to record credit sales, each transaction must be posted to both the subsidiary and the general ledger accounts. Even for a firm with only several hundred sales a month, using a sales journal can save considerable time. Thegeneral journalis the all-purpose journal that all transactions are recorded in. Since all transactions are recorded in the general journal, it can be extremely large and make finding information about specific transactions difficult. That is why the general journal is divided up into smaller journals like the sales journal, cash receipts journal, and purchases journal.

the sales journal

July 12 Purchased $10,000 of merchandise inventory, terms 2/15, n 45, FOB Destination from Gus Grass. In the Commission Code field, enter the correct commission code, or press Enter to accept the default.

Sales Journal Definition

I hope this has helped you in some way, shape, or form with your future endeavors in sales. The importance of keeping a Sales Journal is very valuable to the success of any person working in sales. By writing your Sales Journal, it is only going to benefit you in the future by saving time and money, as well as cutting down on energy wasted on making unnecessary mistakes. You need to make sure that wherever you’re writing your journal, it’s in an environment that will allow you not to be distracted or interrupted.

A sales journal is a subsidiary ledger used to store detailed sales transactions. Its main purpose is to remove a source of high-volume transactions from the general ledger, thereby streamlining the general ledger.

The entity should hire separate employees to enter credit sales transactions. It increases the burden of accounting work on an entity because an entity can also identify the credit sale transaction from the Account receivable account. When recording the credit sale transaction in the sales journal, each such transaction is analyzed in the debit and credit aspects.

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The amount, nature of transactions, customer name, inventory cost, etc., are mentioned in one line. Account ReceivablesAccounts receivables is the money owed to a business by clients for which the sales journal the business has given services or delivered a product but has not yet collected payment. They are categorized as current assets on the balance sheet as the payments expected within a year.

Each of these journals record specific transactions. Entity debited the M/s Global Limited for $ 50,00.00 as account receivables and credited the credit sales by the same amount and also debited the cost of goods sold by $ 37’500.00 and credited the inventory Account. Entity debited the M/s Michel Ltd. for $ 3,00,000.00 as account receivables and credited the credit sales by the same amount and also debited the cost of goods sold by $ 2,25,000.00 and credited the inventory Account.

Each individual sale is posted to its appropriate subsidiary account. After the posting, the account number or a check is placed in the post reference (Post Ref.) column. A sales journal is used to record the merchandise sold on account. Any entry relating to the sale of merchandise for cash is recorded in the cash receipts journal.

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