Journal entries for all transactions

A Journal is a book in which all the transactions of a business are recorded for the first time.

Recording of transactions in accounting

The process of recording transactions in the journal is called Journalising and recorded transactions are called Journal Entries.

Every transaction affects two accounts, one is debited and the other one is credited.

‘Debit’ (Dr.) and ‘Credit’ (Cr,) are the two terms or signs used to denote the financial effect of any transaction. The word ‘journal’ has been derived from the French word ‘JOUR’ meaning daily records. Journal Book is maintained to have prime records for small firms.

After preparing the journal book, the transactions are then posted to Ledger.

Recording transactions examples

Steps to be followed to record business transactions in a journal are: 

1. Ascertain the accounts related to a particular transaction.
2. Find the nature of the related account.

3. Ascertain the rule of debit and credit, applicable to the related account.
4. Record the date of the transaction in the ‘Date Column’.
5. Write the name of the account to be debited in the particulars column along with the abbre
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