How to pass Journal Entries || Financial Accounting I || Chapter # 3 || problem 3.3 A||bymeigs&meig скачать в хорошем качестве

How to pass Journal Entries || Financial Accounting I || Chapter # 3 || problem 3.3 A||bymeigs&meig

In this vedio u learn how to pass journal entries. Journal is a book of original entry. All day-to-day transactions of business are recorded first in it in a chronological order with the help of vouchers like cash receipts, cash memos, invoices, etc. Journal is also called a ‘Day Book’. The process of recording business transactions in the journal is called ‘Journalising’ and the entries passed in this book are called ‘Journal Entries’. . . . The Journal consists of five columns. The first column is used for recording date of the transaction with year. In the second column i.e., ‘Particulars’, the journal entry is made by mentioning the two accounts affected by the transaction. The accounting entry is passed following the ‘Accounting Equation’ or ‘Dual Aspect Concept’. The two accounts affected by the transaction are debited and credited by the same amount. The third column LP, i.e. Ledger Polio is used for writing the page number of the ledger on which the particular account appears. The fourth and fifth columns of journal are meant for writing respectively ‘Debit’ and ‘Credit’ amounts of the transaction. .. Everything we do from this point on will be stuff that real accountants and bookkeepers are doing in their offices at this very moment. That means this lesson will be a little more technical than the previous ones. Don’t let that spook you though. You’ll be surprised at how simple it can be! Now would be a good time for us to lay out the steps in the accounting/bookkeeping process: Imagine having a large stack of receipts and invoices from different shops, suppliers, and customers. All the information you need is there, but it’s useless when it’s all messed up like that! Journal entries help us sort all this into meaningful information. Here’s what a typical journal entry looks like: Transaction: Pay an expense of $100. Journal entry: DrExpense$100CrBank$100 Let’s take a look at what this means. First of all, Dr and Cr are simply abbreviations for Debit and Credit. Every single transaction consists of two movements: a debit movement and a credit movement. Be careful not to confuse this with the debit and credit sides. These are two different things. Debit and credit movements are used in accounting to show increases or decreases in our accounts. Therefore instead of saying there has been an increase or a decrease in an account, we say there has been a debit movement or a credit movement. For example, in the previous tutorial we learned to show the above transaction like this: DEBIT SIDECREDIT SIDEAccountAmountAccountAmountExpense+$100Bank-$100 Now, instead of showing these as pluses and minuses, we will show them in a journal entry as debit movements and credit movements: DrExpenses$100CrBank$100 The nature of each movement is explained below:  DEBIT SIDE (Assets, Expenses, Drawings)CREDIT SIDE (Liabilities, Revenue, Owner’s Equity)  Increase    Debit movement    Credit movement    Decrease    Credit movement    Debit movement   Let’s apply this to our example: When we pay expenses that means our expenses have increased. Also, when we pay expenses, our bank account is obviously going to go down. So, in summary, we need to record a transaction that will increase expenses and decrease bank. Referring back to our matrix, we can see that to increase expenses we require a debit movement. what is accounting record? Accounting records are the original source documents, journal entries, and ledgers that describe the accounting transactions of a business. Accounting records support the production of financial statements. They are to be retained for a number of years, so that outside entities can inspect them and verify that the financial statements derived from them are correct. Auditors and taxing authorities are the entities most likely to inspect accounting records. please subscribe my channel Thank you so much for watching IF you face any issue regarding passing journal entries i will help you as much as i can