What is Journal? What are the Advantages of Journal?

A Journal is a book of original record where every transaction is recorded. It is the book in which transactions are recorded first under the double-entry system. The process & recording transactions in a lbw-nails termed as Journalising.

In a journal a separate entry is recorded for each transaction. For this purpose, a transaction is analysed to determine which account is to be debited and which one is to be credited.

Format of a Journal

  1. Date column. Under this column, the date on which the transac­tion is entered is recorded.
  2. Particulars column. Under this column, first the names of the ac­counts to be debited, then the names of the accounts to be credited and lastly the narration i.e.a brief explanation of the transaction) are entered.
  3. F., i.e., Ledger Folio column. Under this column, the ledger page number containing the relevant account is entered at the time of posting.
  4. Debit amount column. Under this column, the amount to be deb­ited is entered.
  5. Credit amount column. Under this column, the amount to be cred­ited is entered.

Note: Except the L.F. column, all other columns are recorded at the time of journalizing. The L.F. column is recorded at the time of posting.

Advantages of Journal

Recording of notes aspects: Both the aspects (ie., debit and credit) of a transaction are recorded in the journal. Since the amount re­corded is both debit column and credit column must be equal, the possibility of committing error is reduced and it becomes easy to de­tect errors.

Chronological records: Journal is a chronological record in the sense that it records the transactions in the order in which they oc­cur.

Explanation of transaction: Each journal entry carries-narration which gives a brief explanation of the transaction.

Tags: B.Com

Compare items
  • Total (0)