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In this video, we discuss the cash receipts journal, which tracks all cash inflows for a business. The tutorial begins by showing an example involving a regular customer, John Henry, who pays $500 in accounts receivable. The first step is to document the date, then credit John's individual accounts receivable account, noting the invoice being paid. Since John receives a 10% discount of $50, this amount is recorded in the sales discount column. Consequently, $450 is entered in the cash debit column, and the full purchase amount is reflected in the accounts receivable credit column. This process illustrates how to properly record cash receipts in the journal.
