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In this video tutorial, we discuss the cash receipts journal, which tracks all cash inflows for a business. The tutorial includes an overview and a specific example involving a regular customer, John Henry, who pays $500 on his account. The first step in the journal is to enter the date. Next, we credit the individual accounts receivable account for John Henry and include a description of the invoice being paid. If available, the invoice number is noted. Since John receives a 10% discount of $50, this amount is recorded in the sales discount column. The cash debit column reflects $450, while the full purchase amount is recorded in the accounts receivable credit column.
