The Journal (Edexcel IGCSE Accounting)

The Journal

What is the journal?

• The journal is also referred to as the general journal

• The journal is used to record all transactions that do not go into the other books of original entry, such as:

  • Opening balances when a business is first created

  • Introducing capital

  • Taking drawings

  • Purchasing a non-current asset

  • Selling a non-current asset

  • Correcting errors

  • Transferring balances to the income statement

How do I make a journal entry for a transaction?

• STEP 1
  Enter the date

• STEP 2
  Enter the name of the account(s) that need to be debited in the details column

  • It is conventional to enter the debit accounts before the credit accounts

• STEP 3
  Enter the corresponding values in the debit column

• STEP 4
  Enter the name of the account(s) that need to be credited in the details column

  • It is conventional to leave an indent for the credit entries

• STEP 5
  Enter the corresponding values in the credit column

  • Make sure the total debit amount is equal to the total credit amount

• STEP 6
  Write a narrative for the journal entry

  • This is a brief explanation of the transaction

  • This is especially useful for non-regular transactions and for correction of errors