Journal, Journal:

Journal is a book of prime entry or a book of original entry in which transaction are first recorded in a
chronological (in order of date or time , date wise)order. The word journal has been derived from the
French word "Jour" Jour means day. So, journal means daily.

Terms use for Journal

 Book of original Entry

 The transaction recorded in same day, so journal is called Day book.
 Transaction is recorded chronologically, so journal is called chronological Book.
 Journal make ledger posting easy, so journal called Assistant to Ledger or Subsidiary Book.
 Journal is a book of source entry.

Journal Format

Journal Have 5 Columns Journal

Date Particular L DR CR
F
 01 Jan 20  Purchase    5000  
    To Cash      5000
Date: 01 Jan 2020 Purchase good for cash Rs 5000 

 Entry: To enter, register or record a transaction in journal is called make a entry.

 Journal Entry: An entry recorded in journal is called journal entry.
 Journalizing: The process of recording transaction in journal.
 Journalizing: The act of recording transaction in journal is called Journalizing
 Compound Entry: When two or more transaction of the same nature take place on the same
date a compound entry may be made instead of separate entry of each transaction.
 Narration is written below each transaction
 Use Dr after each debit and To before each credit
 Cash discount entry: cash discount allowed is a business loss; Cash discount received is a
business gain.
 Trade Discount: No entry is passed for trade discount, the purchase or sale should be recorded
at net price.
 Goods away as charity, taken by the owner for personal use, distribution free as samples will be
credited to purchase account.
Date Particular L DR CR
F
 01 Jan 20  Cash    100000  
    To Capital      100000
Company A was incorporated on January 1, 20X0 with an initial capital of Rs 100000/=

Date Particular L DR CR
F
 02 Jan 20 Prepaid Rent    36000  
    To Cash      36000
Jan 2 : An amount of Rs 36,000 was paid as advance rent for three months

Date Particular L DR CR
F
 03 Jan 20 Equipment    80000  
    To Cash     60000
To Note Payable 20000
Jan 3 : Paid Rs 60,000 cash on the purchase of equipment costing Rs 80,000.The remaining amount
was Note payable

Date Particular L DR CR
F
 04 Jan 20 Office Supplies   17600  
    To Account Payable      17600
Jan 4: Purchased office supplies costing Rs 17,600 on account.

Date Particular L DR CR
F
 13 Jan 20 Cash    28500  
    To Service Revenue     28500
Jan 13: Provided services to its customers and received Rs 28,500 in cash.

Date Particular L DR CR
F
 13 Jan 20 Account Payable    17600  
    To Cash      17600
Jan 13: Paid the accounts payable on the office supplies purchased on January 4

Date Particular L DR CR
F
 14 Jan 20 Wages Expense    19100  
    To Cash      19100
Jan 14: Paid wages to its employees for first two weeks of January, aggregating Rs 19,100.
Date Particular L DR CR
F
 18 Jan 20 Cash   32900  
  Account Receivable     21200
To Service Revenue 54100
Jan 18: Provided RS 54,100 worth of services to its customers. They paid Rs 32,900 and promised to
pay the remaining amount.

Date Particular L DR CR
F
 23 Jan 20 Cash    15300  
    To Account Receivable     15300
Jan 23: Received Rs15,300 from customers for the services provided on January 18.

Date Particular L DR CR
F
 25 Jan 20 Cash    4000  
    To Unearned Revenue     4000
Jan 25: Received Rs 4,000 as an advance payment from customers.

Date Particular L DR CR
F
 26 Jan 20 Office Supplies    5200  
    To Account Payable     5200
Jan 26: Purchased office supplies costing Rs 5,200 on account

Date Particular L DR CR
F
 28 Jan 20 Wages Expense   19100  
    To Cash     19100
Jan 28: Paid wages to its employees for the third and fourth week of January: Rs 19,100

Date Particular L DR CR
F
 31 Jan 20 Dividends    5000  
    To Cash     5000
Jan 31: Paid Rs 5,000 as dividends.

Date Particular L DR CR
F
 31 Jan 20 Electricity Expense   2470  
    To Utility Payable     2470
Jan 31: Received electricity bill of Rs 2,470.

Date Particular L DR CR
F
 31 Jan 20 Telephone Expense    1494  
    To Cash   1494
Jan 31: Received telephone bill of Rs 1,494..

Date Particular L DR CR
F
 31 Jan 20 Miscellaneous Expenses   3470  
    To Cash     3470
Jan 31: Miscellaneous expenses paid during the month totaled Rs 3,470

Date Particular L DR CR
F
 31 Jan 20 Bank Account    50000  
    To Loan Account     50000
Jan 31: Loan taken form Bank Rs 50000

Date Particular L DR CR
F
 31 Jan 20 Interest Loan    300  
    To Bank Account     300
Jan 31: Interest paid on Bank loan Rs 300/=

Date Particular L DR CR
F
 31 Jan 20 Drawing   500  
    To Purchases Account     500
Jan 31: Good taken for personal use Rs 500/=

Date Particular L DR CR
F
 31 Jan 20 Saddam   1000  
    To Cash     1000
Jan 31: Cash Paid to Saddam

Date Particular L DR CR
F
 31 Jan 20 Cash   300  
  Bad Debts    700
To Saddam Acc 1000
Jan 31 : Cash received from Sadam Rs 300/= instead of Rs 1000/= Remaining is bad debts

Date Particular L DR CR
F
 31 Jan 20 Cash   700  
    To Bad Debts     700
Jan 31: Bad debts recover from Sadam Rs 700/=

Date Particular L DR CR
F
 31 Jan 20 Loss by Theft, Fire, Damage   1000  
    To Purchase Account     1000
Jan 31: Loss of stock by theft/fire/damage Rs 1000/=

Date Particular L DR CR
F
 31 Jan 20 Rent 12 Months   12000  
  To Cash   11000
To Outstanding Rent 1000
Jan 31 : Outstanding Exp (Rent paid for 11 Month instead of 12 Months One month is pending)

Date Particular L DR CR
F
 31 Jan 20 Rent 12 Months   12000  
  Prepaid Exp    1000
To Cash / Bank Acc 13000
Jan 31 : Prepaid / Unexpired Expense (Rent paid for 13 month One month is advance)

Date Particular L DR CR
F
 31 Jan 20 Cash 11 Months   11000  
  Accrued Income    1000
To Commission 12000
Jan 31 : Accrued Income (Commission received for 11 month instead of 12 month)