Journal General

The general journal is where double entry bookkeeping entries are recorded by debiting one or more accounts and crediting another one or more accounts with the same total amount. The total amount debited and the total amount credited should always be equal, thereby ensuring the accounting equation is maintained.

Format
A general journal entry includes:
1. The date of the transaction;
2. The title of account credited is indented several spaces
3. Titles of the accounts debited and credited;
4. The amount of each debit and credit; and,
5. An explanation of the transaction also known as a Narration.

Example Acme, Inc carried out the following transactions in May 2009. 1 May: Paid telephone bill of $100. 4 May: Performed consulting services for Example LLP on credit, $350 6 May: Paid wages of $180 13 May: Received from customer $350. 19 May: Performed consulting services for cash, $120 25 May: Purchased a computer for $2000. Paid $500 cash (cheque #0002), borrowed the remainder from the bank. The above transactions may be journalized as follows:
Date General ledger account title Debit Credit 1-May Telephone Expense 100 Cash 100 Paid Telephone Bill 4 Accounts receivable 350 Consulting services revenue 350 6 Salary Expense 180 Cash 180 Paid Salary 13 Cash 350 Account Recievable 350 Received Payment By Customer 19 Cash 120 Consulting Service Revenue 120 Received Cash 25 Computer 120 Cash 120 Loan Payable Purchased Computer