STEPS

1. COLLECT ALL YOUR SOURCE DOCUMENT

2. BOOK OF PRIME ENTRY :

Purchase journal (credit purchases only)

Sales journal (cash sales account)

date details debit credit

Cash book (receipt and payment)

date details cash bank date details cash bank

3. DOUBLE ENTRY(LEDGER) debit and credit (no pro forma)make a ledger

for every asset, liabilities and capital
DEBIT(in) LEDGER TITLE CREDIT(out)

Date Details Amount Date Details Amounts

ACCOUNTS TO RECORD ENTRY

ASSETS AN INCREASE DEBIT
A DECREASE CREDIT
LIABILITIES AN INCREASE CREDIT
A DECREASE DEBIT
CAPITAL AN INCREASE CREDIT
A DECREASE DEBIT

 Additional rule: debit receiver, Credit giver (from-debit, to- credit)

 A transaction has 2 records

1. TRIAL BALANCE (debit =credit) no pro forma

Debit Credit
2. PROFIT AND LOSS STATEMENT
3. STATEMENT OF FINANCIAL POSITION