What are Journal Entries?
A journal entry is the record of a money related transaction recorded (unaltered) in a journal. A journal items all the budgetary transactions of a business and which accounts these transactions influence. All business transactions are at first recorded in a journal utilizing the double entry or single-entry strategy for accounting.
Ordinarily, journal entries are entered in order request and charges are entered before the credits. They furnish foundational data for all other monetary reports and are utilized by auditors to break down how fiscal transactions affect a business. They are allocated to particular records utilizing a Chart of Accounts, and the journal entry is then recorded in a record account.
The journal entries include the following data:
Date: The date of the money transferred and entered in the journal accounts has to be mentioned. The dates are recorded to keep it future reference that when a certain transaction has been made.
Particulars: It consists of the name of the items that has created the cause of the transaction. It may be various items such as a purchase, salary, transit and many more other things that are used in terms of money.
Ledger Folio: It is the reference number of the respective ledger accounts.
Debit Amount: Amount is segregated into two broad classifications that are debit and credit. The debit column is for the amount that goes out, that is the money that has been deducted from the account.
Credit Amount: The credit amount is the column that defines the amount that is coming in. Thus the credit amount is the money that has been entered in the account via certain means.
Narration: Certain amount that has been debited or credited for a transaction has to be described. For this there is a last column in the journal entry that is narration. It describes the transaction made in the entry format of the account.
Sample Journal Entry
Date Particulars L\F No. Amount (Dr.) Amount (Cr.)
2014
Feb 24 Purchase
Ordinarily, journal entries are entered in order request and charges are entered before the credits. They furnish foundational data for all other monetary reports and are utilized by auditors to break down how fiscal transactions affect a business. They are allocated to particular records utilizing a Chart of Accounts, and the journal entry is then recorded in a record account.
The journal entries include the following data:
Date: The date of the money transferred and entered in the journal accounts has to be mentioned. The dates are recorded to keep it future reference that when a certain transaction has been made.
Particulars: It consists of the name of the items that has created the cause of the transaction. It may be various items such as a purchase, salary, transit and many more other things that are used in terms of money.
Ledger Folio: It is the reference number of the respective ledger accounts.
Debit Amount: Amount is segregated into two broad classifications that are debit and credit. The debit column is for the amount that goes out, that is the money that has been deducted from the account.
Credit Amount: The credit amount is the column that defines the amount that is coming in. Thus the credit amount is the money that has been entered in the account via certain means.
Narration: Certain amount that has been debited or credited for a transaction has to be described. For this there is a last column in the journal entry that is narration. It describes the transaction made in the entry format of the account.
Sample Journal Entry
Date Particulars L\F No. Amount (Dr.) Amount (Cr.)
2014
Feb 24 Purchase