The Voucher System Chapter 24 24 1 Characteristics

The Voucher System Chapter 24 24 - 1

Characteristics of a Voucher System Separation of duties is built into a voucher system. n Authorization of transactions is separated from recording and execution of these activities. n No purchases are made without an approved voucher. n 24 - 2

Characteristics of a Voucher System All vouchers are supported by documents and records. n Cross-referencing and cross-checking is part of the voucher system. n Transactions are traced throughout the system. n 24 - 3

Learning Objective 1 Preparing vouchers, recording them in a voucher register, and recording payment of vouchers in a check register. 24 - 4

Learning Unit 24 -1 n 1 2 3 4 5 What are the elements of voucher system? Vouchers Voucher register Unpaid voucher file Check register Paid voucher file 24 - 5

Learning Unit 24 -1 Jones Supply Co. Purchase Order# 0732 Date: November 3, 20 x 8 Ordered from Beam Co. Date Needed Ship via F. O. B. Terms Nov. 28, 20 x 8 Rail Destination 2/10, n/30 Quantity Unit Ordered Received Description Price Amount 100 V 3421 Staplers $ 5. 00 $ 500 200 V 3918 Calculators 20. 00 4, 000 Total $4, 500 24 - 6

Learning Unit 24 -1 Beam Co. (Salesman, Munroe) Invoice Number: B 20 Sold to: Jones Supply Co. Date: November 3, 20 x 8 Your Purchase Shipped via: F. O. B. Terms Order #: 0732 Rail Destination 2/10, n/30 Quantity Unit Ordered Received Description Price Amount 100 V 3421 Staplers $ 5. 00 $ 500 200 V 3918 Calculators 20. 00 4, 000 Total $4, 500 24 - 7

Learning Unit 24 -1 Jones Supply Co. Invoice Number: B 20 November 28, 20 x 8 Purchase Order #: 0732 Voucher No. 23 Check needed: Dec. 5, 20 x 8 Payable to: Beam Co. Invoice amount $4, 500 Less discount 10 Net Amount Due $4, 410 Verification Steps: Date (1) Invoice compared with purchase order 12/1/x 8 (2) Invoice compared with receiving report 12/1/x 8 (3) Extension and footing done 12/1/x 8 (4) Approved for payment 12/3/x 8 24 - 8

Learning Unit 24 -1 All vouchers are pre-numbered. n Any voided vouchers must be kept on file. n The invoice for a transaction is compared to the related purchase order, receiving report, and other supporting documentation. n The voucher is prepared when all information is cross-referenced. n 24 - 9

Learning Unit 24 -1 The voucher register is a special journal that replaces the purchases journal. n A voucher is entered into the register on the date the related liability is incurred. n A check number is entered on the date of payment. n 24 - 10

Learning Unit 24 -1 Column totals for Vouchers Payable, Purchases, Supplies, etc. are posted at the end of the month. n Individual amounts are posted to the subsidiary ledgers daily. n 24 - 11

Learning Unit 24 -1 Each voucher is recorded in the voucher register at the time a liability is incurred. n It is then placed into a file in the order of the due date. Filing by due date is important in order to avoid any late payments. n The voucher remains in this file until it is paid. n 24 - 12

Learning Unit 24 -1 The check register replaces the cash payments journal. n The check register for a voucher system has many columns. The columns in this special register have account and number headings linked to the voucher register. n The paid vouchers are filed in sequential order of voucher numbers. n 24 - 13

Learning Objective 2 Recording revised vouchers to handle nonroutine transactions in a voucher system. 24 - 14

Learning Unit 24 -2 How do some companies record the following additional transactions? 1 Purchase returns and allowances after the voucher has been recorded. 2 Partial payment plans that adjust the voucher prepared for full payment. n Cancel the old voucher and prepare a new one with the correct amount. n 24 - 15

Learning Objective 3 Using the net amount method to record invoices and payment. 24 - 16

Learning Unit 24 -2 How do some companies record purchases at net amount? n Vouchers are recorded at net amount. n The applicable discount is subtracted first. n A Purchases Discount Lost account is used to record missed discounts related to late payments. n 24 - 17

Learning Unit 24 -2 n Mill Company buys merchandise on account for $8, 000, 2/10, n/30. Gross method Purchases 8, 000 Vouchers Payable 8, 000 Net method Purchases 7, 840 Vouchers Payable 7, 840 24 - 18

Learning Unit 24 -2 n What if the discount is taken on time? Gross method Vouchers Payable 8, 000 Purchases Discount Cash 160 7, 840 Net method Vouchers Payable 7, 840 Cash 7, 840 24 - 19

Learning Unit 24 -2 n What if the discount is missed? Gross method Vouchers Payable 8, 000 Cash 8, 000 Net method Vouchers Payable 7, 840 Discount Lost 160 Cash 8, 000 24 - 20

End of Chapter 24 24 - 21