Junior Secondary  School

Business Studies JSS 1(Basic 7)

Second Term Lesson Notes

Subject : 

Business Studies

 

Term :

SECOND TERM

 

Week:

Week 11

 

Class :

JSS 1

 

Topic :

JOURNALS

 

Previous lesson : 

The pupils have previous knowledge of

 

SOURCE DOCUMENTS

that was taught as a topic during the last lesson.

 

 

Behavioural objectives :

At the end of the lesson, the pupils should be able to

 

• Explain the term Return Outward Day Book
• Sate the purpose of Returns Inward Journal?
• Write out what Purchase day book and Sales day book are used for
• Mention the purpose of each journal?

 

 

Instructional Materials :

• Wall charts
• Pictures
• Related Online Video
• Flash Cards

 

 

Methods of Teaching :

• Class Discussion
• Group Discussion
• Asking Questions
• Explanation
• Role Modelling
• Role Delegation

 

Reference Materials :

• Scheme of Work
• Online Information
• Textbooks
• Workbooks
• 9 Year Basic Education Curriculum
• Workbooks

 

Content :

 

JOURNALS

CONTENT

1. Meaning of Journal
2. Format of a Journal
3. Types of Journal
4. Purchase Day Book or Purchases Journal
5. Sales Journal
6. Returns Outward Day Book and Returns Inward Day Book

 

Meaning of Journal

A journal is a document which contains the daily records of business transactions. Each record in a journal is called an entry. The journal is called a book of original entry because its entries are transferred to a second book.

Format of a Journal

	Date	Particulars	Folio	Invoice No.	Amount

Types of Journal

We have two major divisions of Journals: General Journal and Special Journal

General Journal

This is a book that records all transactions (both sales and purchases). It is also used to correct errors made in the books of account. It is used when no special journal exists. It can also be called The Journal.

Format of a General Journal

	Date	Particulars	Folio	Invoice No.	Dr.	Cr.

Special Journal

It is used to record only one type of entry. Types of Special Journals are listed below:

1. Purchases Journal
2. Sales Journal
3. Return Inward Journal
4. Return Outward Journal

In order to keep the general ledger free from unnecessary details, separate journals are kept for credit transactions concerning sales and purchases.

Let’s take each of them one after the other.

Purchase Day Book or Purchases Journal

This is also known as the bought Journal. It is used to record all daily particulars of goods bought for resale on credit. It is maintained exclusively for credit purchases of goods meant for resale. Entries are made in the purchase journal from the purchase invoices issued by the sellers.

Preparation of Purchase Journal

Debit purchase account with the total amount of purchases for the period. Credit the individual seller’s (creditor) account with the net amount.

Example:

Enter these transactions in the purchase journal of Oke & sons for the month of June 2000, and post this to the ledger,

June 15 Ekpe & Co.: Invoice No. 102

15 Dozens of Eraser at 250k a dozen

30 Rulers at 50k each

40 Writing pad at 10k each

200 Envelopes at 15k per 25

Invoice subject to 10% trade discount

June 16 Bought from Ayi Effiom Bookshop invoice No. 37

10 Reams of foolscap at N350 per ream

6 Dozen Exercise books at N12 a dozen

21 B. Allegro, invoice No. ACP 134 N6,500

Subject to 20% trade discount

Oke & Sons

Purchases Journal for the month of June, 2000

	Date	Particulars	Invoice	Folio	Detail	Total
	June 5	EKPE & Co.	102	L8	₦	₦
		15 dozen erasers @ 25k a dozen			37.50
		30 rulers @ 50ok each			15.00
		40 writing pads @ 10k each			4.00
		200 envelopes @ 15k per 24			120.00
		Less 10% trade discount			176.50
					17.65	158.85
	June 10	Ayi Effiom Bookshop	37	L9
		10 reams of foolscap @ ₦350 a ream			3,500.00
		6 dozen exercise books @ ₦120 a dozen			720.00	4,220.00
	June 21	B. Alogbo	ACP 134	L10
		Purchase of goods			6,500.00
		Less 20% trade discount			1,300.00	5,200.00
	June 30	Purchase Accounts	Dr	L12		9,578.85

Sales Journal

This is one of the books of original entry. It is used to record daily sales of goods on credit. The recording of transactions into sales journals is the same as purchase journal except in posting to the ledger. In the ledger, debtors (customers) personal accounts are debited and sales accounts credited in the general ledger with the total amount of credits sales for the period.

Example:

Aneke venture is a dealer is cloth materials. Enter the transaction below in his sales day book.

November 2, 2000

Sold to Ibete $ Sons and issued invoice No. 163

200  Meters of Nylon material at N150 a metre

180  Meters of Silk material at N120 a metre

160  Meters of Travara material at N170 a metre

Invoice is subject to 5% trade discount

November 18, 2000

Sold to Ada & Sons invoice No. 46

7  Nylon shirts at N550 each

11 Singlets at N140 each

2  Dozens handkerchiefs at N115 each

Anieke Venture

Sales Day Book for the Month

			Invoice	Folio	Detail	Total
	Nov. 2	IBETE & SONS	102	L8	₦	₦
		200 meters of Nylon @ N150 a metre			30,000
		180 meters of silk @ N120 a metre			21,600
		160 meters of Travara @ N170 a metre			27,200
					78,800
		Less 10% trade discount			3,940	74,860
	Nov. 18	ADA & SONS	45	L4
		7 Nylon shirts @N550 each			3,850
		11 Singlets @ N140 each			1,540
		2 Dozens Handkerchiefs @ N15			360	5,750
		Sales Accounts	Cr			80,610

 

Returns Outward Day Book and Returns Inward Day Book

Returns Outward Day Book

This day book is also called Returns outward Journal or purchases return book. It is used for recording all goods returned to the sellers and allowances granted by them. Entries are made from the credits notes received from the seller. The total amount of the returns and allowances for a period are credited to the returns outwards account in one figure in the ledger while individual items are debited to the personal accounts sellers in the purchase ledger.

Example:

The following returns were made to sellers on the dates shown. Record them in the returns outwards journal.

Oct. 5 Returned 1 carbon of biscuit at N250 to B. Ekpe, Credit Note No. 02/13

Oct. 6 Returned to R. Igwe Note No. 02/44 N500

Oct. 8 Received a note from Obongha & Sons on goods returned, Note No.27 N450

	Date	Supplier/Seller	Note No.	Folio	Amount
	Oct. 5	B. Ekpe	02/13	7	₦250
	6	R. Igwe	02/24	8	₦500
	8	Obongha & Sons	27	29	₦450
	8	Returns Outwards A/C CR			₦1,200

Returns Inward Day Book

This is also known as sales return book or Returns inward Journal. It is used for recording the particulars of all goods returned by customers and the allowance granted to them. The source document for returns inwards journals is the credit note prepared by the seller who is accepting the goods returned.

Example:

The following returns were made by Ibete & Co customer on the date specified. Record the transactions into the returns inwards journal.

	Feb.10	Eko & Sons, Note No. 17	₦100
	Feb.12	Upla Enterprises Note No. 18	₦280
	Feb.16	Ethothi Ventures Note No. 20	₦350
	Date	Name of Customer	Note No.	Folio	Amount
	Feb. 10	Eko & Sons	17	3	₦100
	Feb. 12	Upla Enterprises	18	7	₦280
	Feb. 16	Ethothi Venture	20	10	₦350
	Feb. 16	Retuns Inward A/C DR			₦730

 

 

Presentation

 

The topic is presented step by step

 

Step 1:

The class teacher revises the previous topics

 

Step 2.

He introduces the new topic

 

Step 3:

The class teacher allows the pupils to give their own examples and he corrects them when the needs arise

 

 

 

 

 

EVALUATION

1. What do you understand by the term Purchase day book and Sales day book?
2. What is the purpose of each journal?
3. Explain the term Return Outward Day Book
4. What is the purpose of Returns Inward Journal?
5. From the following particulars, prepare purchases day book of Micheal & Co.

   Jan. 5  

   Bought goods from Alabi and Sons

   3 Cartons of Biscuit at N450 a carton

   2 cartons of Jumbo matches at N350 a carton

   The invoice is subject to 5% discount

   Jan. 8

   Received invoice No. 11 from Tosan Enterprises.

   4 dozens of 40 leaves exercise books at N600 a dozen

   100 erasers at 5 for N2

   20 rulers at N4 each
6. Credit sales were made to the under mentioned customers. Record the transaction in the sales journals.
   

   	April 5	Fidelis Enterprises, invoice No. 02/8	₦1,020
   	April 7	Sholaja & Co., invoice No. 02/12	₦2,500
   	April 9	Mayowa , A.A. invoice No. 02/16	₦1,350
   	April 10	Usman & Sons, invoice No. 02/20	₦3,150
   	April 15	Bolujo invoice No. 02/21	₦1,235

   5. A Credit note was received from Onete Ukam by E. Ina. Below is the credit note No. 102:

   	1 Carton of biscuit at N350	₦350
   	25 Empty cases returned at N15 each	₦375
   		₦725

   You are required to prepare returns outward journal.
7. Record the following transactions into the returns inward journal.

8. 	June 6	O. Etim, Note No. 41	₦275
   	June 8	A. O. Aduquo, Note No. 43	₦330
   	June 9	Onda Enterprises, Note No. 44	₦250
   	June 11	Owal & Sons, Note No. 46	₦315

    

    

 

Conclusion

The class teacher wraps up or conclude the lesson by giving out short note to summarize the topic that he or she has just taught.

The class teacher also goes round to make sure that the notes are well copied or well written by the pupils.

He or she does the necessary corrections when and where  the needs arise.