What the journal is for
Most entries start in a day book or the cash book. See which ones start in the journal instead, and how a journal entry is set out.
In this room: 2 tasks, 8 questions
- Where everything else goes4 questions
- How a journal entry is set out4 questions
A book of prime entry is where a transaction is first written down, before it reaches the ledger.
- Sales and purchases day books
- goods sold and bought on credit
- Cash book
- money paid into and out of the bank
- Journal
- anything that fits in neither
Marlow Cycles is a bike repair shop owned by Dev Marlow. Tasha keeps its books. She uses the journal for:
- The opening entries of a new business
- Writing off a debt that will not be paid
- Correcting an error
- One-off transactions, such as equipment bought on credit
Answer the questions below
3 more questions follow in this task.
A journal entry names the accounts to debit and the accounts to credit. The debits are written first, and total debits must equal total credits.
It ends with a narrative: a short note that says what the entry is for.
| Details | Debit | Credit |
|---|---|---|
| Workshop equipment | 640.00 | |
| Tooling Direct | 640.00 | |
| Wheel stand bought on credit, invoice 771 |
The journal is not an account. It is an instruction, and the entry still has to be posted to the ledger. The purchases day book is not used here, because it is only for goods bought to sell on.
Answer the questions below
3 more questions follow in this task.