JOURNAL ENTRIES

A introduction to journal entries

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CONTENTS
o introduction to Journal Entries

o Definition of Journal Entries

o Importance of Journal Entries

o Types of Journal Entries

o Examples of Journal Entries

o Common Mistakes in Journal Entries

o Conclusion
 INTRODUCTION
A Journal is a book in which all the transactions of a business are recorded for
the first time. The process of recording transactions in the journal is called
Journal entries provide initial details about financial transactions in your
business.
.
 DEFINITION OF JOURNAL
ENTRIES
Journal entries are the fundamental accounting
records used to capture and document financial
transactions in a company's accounting system. They
serve as the foundation for maintaining accurate and
organized financial records
 I M P O R TA N C E O F
JOURNAL ENTRIES
Time Management: Journals assist in managing time effectively by
prioritizing tasks, setting schedules, and identifying time-wasting habits
.
Decision Making:
.
In a business context, journal entries are crucial for
accurate financial records, aiding in informed decision-making.

Accountability: Regular journaling holds individuals accountable for their

actions and commitments, fostering discipline and responsibility.

Clarifying Values: Journals help individuals clarify their values, beliefs, and
priorities, guiding decision-making.
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A PROFORMA OF JOURNAL
Date Particulars l.F Debit Credit
(1) (2) (3) (4) (5)

Crypto: investing & trading

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Column 1: Transaction Date

o The first column in the Journal book consists of the transaction date.
Column 2: Journal Entry::
o The second column is where we record the business transaction by passing a Journal Entry.
Column 3: Folio
o The third column is the folio number, which indicates the reference number used to identify the
particular entry in respective ledger accounts
Column 4: Debit Amount
o The fourth column shows the amount by which the respective account is debited in the transaction.
o Column 5: Credit Amount
o Like column 4, which shows the amount by which an account is debited, column 5 represents the
amount by which the respective account is credited
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DOUBLE-ENTRY ACCO UNTI NG

o Definition
A double entry accounting system refers to the bookkeeping method where
two entries are made simultaneously into two different accounts, indicating a
firm’s cash inflow and outflow. The purpose is to tally both the accounts and
balance the credit and the debit side. This accounting system helps
organizations assess their overall performance in a financial year.
o It is different from the single entry accounting system, which involves filling in
the information in only one account. Only a single entry recording the income
and expenses in a cash register helps maintain the financial information to
enable businesses to assess their position.
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EXAMPLES OF JOURNAL ENTRIES

Entry #1 — mohanforms the corporation by purchasing 10,000 shares of $1 par stock.

Journal entries
 .
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E NT RY # 2 — P GS’ S FI R ST R E NT
PAY M E N T I S D U E

JOURNAL ENTRIES
 SUMM ARY
Each journal entry contains the data significant to a single business transaction,
including the date, the amount to be credited and debited, a brief description
of the transaction and the accounts affected. Depending on the company, it
may list affected subsidiaries, tax details and other information.
THANK YOU
Gaurav kushwaha