How formulate your transcations on a general journal then post it to a general ledger
To formulate transactions on a general journal and then post them to a general ledger, follow these steps:
1. Gather the necessary information: Collect all the relevant details for the transaction such as the date, accounts involved, transaction description, and amounts.
2. Open the general journal: Start by opening a blank general journal. This is a chronological record of all the transactions of a company.
3. Identify the accounts: Determine which accounts are involved in the transaction. Each transaction affects at least two accounts: one account will be debited (increased) and another account will be credited (decreased).
4. Record the transaction: Write the date of the transaction on the leftmost column of the general journal. Then, in separate rows, record the debit and credit amounts along with the corresponding accounts. The debit amount is usually listed first, followed by the credit amount.
5. Summarize the transaction: Calculate the totals for the debit and credit columns, ensuring they are equal. If not, review your entries for errors before proceeding.
6. Open the general ledger: Now it's time to post the journal entry to the general ledger. The general ledger is a collection of individual accounts where you record all transactions related to each specific account.
7. Locate the accounts: Find the accounts involved in the transaction within the general ledger. Each account has its own page or section in the ledger.
8. Post the transaction: Transfer the debit and credit amounts from the journal to the appropriate account in the general ledger. Record the date and a brief description of the transaction in the corresponding columns.
9. Calculate the new balances: Update the account balances in the ledger by adding the debits and subtracting the credits. The balance should reflect the new total after the transaction.
10. Repeat the process: Continue recording transactions in the general journal and posting them to the general ledger as they occur. Make sure to maintain accuracy and consistency throughout the process.
By following this step-by-step process, you can correctly formulate transactions on a general journal and then post them to a general ledger, ensuring the accuracy and organization of your financial records.