Page 82 -

64 CHAPTER 3 Introduction to Accounting

Figure 3-15: Accounts payable accounting

the fulfi llment process in Chapter 5. For GBI, the designated reconciliation
account is accounts receivable reconciliation (#110100).
Let’s consider a scenario in which GBI sells bicycles to two customers on
credit for $5,000 and $3,000, respectively, and then receives payment at a later
date. These purchases are Steps 1 and 2 in Figure 3-16. The relevant accounts
are sales revenue and the individual customer accounts. Sales revenue is cred-
ited by the amount of the sale, and a corresponding debit is made to the appro-
priate customer account. This debit is also automatically posted to the accounts
receivable reconciliation account as indicated by the arrows in Figure 3-16.

31/01/11 1:09 PM
CH003.indd 64 31/01/11 1:09 PM
CH003.indd 64