First record of transaction inside books of account is known as Journal entries. Journal entries are the first entry done for the transaction in the chronological approach, and helps in preparing additional financial accounting statements for example ledger. Journal entries are the most simple form of accounting entries where we get to understand accounts which are affected by the specific transaction. Journal entry not simply assists with ascertaining the accounts i.e. real, personal or nominal accounts are affected but it also assists with identifying the management of those account in the specific transaction. All bookkeeping transactions are listed by means of publication records that show account, values, and whether these records will be listed in debit or credit part of records. To document any transaction in the books, journal uses double entry book keeping system, where each debit has equal credit amount. Transactions are therefore recorded on both the side of the format, wherever debit is on the left hand side while credit is on the right hand side. In journal entry, sum of debit side is always equal to the sum of the credit side of the transactions. Hence the journal account is probably balanced when sum of debit is equal to the sum of the credit side. Every journal entry needs the narration which is done to explain the reason behind debit and credit of the books of accounts. A folio number is usually given in the format to cross check the accounting records of the two documents.
Get flat 30% discount with your first order. Use coupon code ABT30 during checkout.