BA 3340 Lecture Notes - Lecture 34: Cash Flow Statement, Accounting Equation, Deferral
Document Summary
Because the journal is where transactions are first recorded into the accounting system, it is often called the book of original entry. Entries recorded in journals are called journal entries. The following standardised format indicates the accounts and amounts, with debits on the first line and credits (indented) on the second line: When an accounting transaction is recorded in the general journal, we often say that the transaction has been journalised. A business can examine its journal if it has a question about whether a transaction was recorded or recorded correctly. However, it is not very useful if a company is trying to determine the balance in a particular account. To get an account balance, one would have to find all journal entries affecting that account. To avoid such time-consuming task, info recorded in general journal is transferred to ledger. (cid:131) a ledger is a collection of accounts and their balances.
