Chapter 4 General Journal Accounting 100 Skyline College
Objectives u Record transactions in a general journal u Prepare compound journal entries u Post journal entries to general ledger u Correct errors in the journal & ledger u Terminology
General Journal u Entries in chronological order. u Called record of original entry. u Minimum of 3 lines/transaction u Debit account on first line. u Credit account on second line. u Explanation on last line.
Recording Transactions u Debit entry flush (even) with the left margin. u Credit entry is indented 1/2- inch from the left margin. u Explanation is indented 1-inch from the left margin.
Compound Entries u A journal entry that contains: v several debits or several credits u Debits always recorded first u Credits always follow the debits u Total debits must = total credits
Ledger Account Form u Four-column account form with balance columns. u Maintains a running balance for each account. u All accounts together are referred to as a ledger.
What is Posting? u Copy entries from the general journal to the ledger accounts. u Four steps in the posting process (illustrated on p. 107).
Posting Steps ledger Write the date in the ledger account. ledger Write the journal page # in the Post Reference column of the ledger. ledger Write the $ amount in either the Debit or Credit column in the ledger. ledger. Determine the balance in the ledger. journal Enter the account # in the Post Reference column of the journal.
Correcting Errors u Ruling Method: U sed to correct errors before entry has been posted. u Cross out and enter correct information. u Correcting Entry: Used when amounts have been posted. u An entry is made to correct the error.