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What is a journal and how to write it in an account | Journal-chapter-4-Transaction-Introduction

Makingaccount Guideline for Preparation of journal account

Steps 1: Identify the transaction type and journal rules

transaction type
Bilateral unilateral Debit unilateral Credit transfer & contra

unilateral benefit transaction

A Transaction Between Two Persons
In Which One Receives The Benefit And The Other Agrees To Receive The Benefit After A Specified Number Of Days, Or in which one has already received the benefit and the other will now receive the benefit.

How to enter a unilateral benefit transaction in the journal.

If the company is giving the benefit, in the debit method and if the company is receiving the benefit, in the credit method, transaction details should be recorded in the journal account.

Method of recording a Credit transaction in a journal account.

  • D.What benefits are received?
  • C.Who gives benefits?

Method of recording a Debit transaction in a journal account.

  • D. Who receives the benefits?
  • C. what benefits goes out?

bilateral benefits transaction

If The Business And Others (Customer Or Supplier) Receive The Benefit On The Same Day It Is A bilateral benefit transaction

How to enter a bilateral benefit transaction in the ledger.

details of both debit and credit should be recorded in the journal account.

How to identify the transaction

transaction date Transaction...information   Date actual Payment due date or Payment date payment transaction transaction ID
01/04/2024 Purchased stationery from GK shop & paying $2000 cash. (01/04/2024) 01/04/2024 20000 01/04/2024 20000 Bilateral ct87
11/04/2024 Tools box were purchased from JK tools shop $1200 (credit) (11/04/2024) 11/04/2024 12000 - - unilateral cr401
24/04/2024 Paid $1200 by ABC bank check to Jk Tools Shop 11/04/2024 12000 24/04/2024 12000 unilateral cr401
20/05/2024 $800 was transferred from the profit account to the revenu reserve account 20/05/2024 800 contra tr251
We will see about the Contra entry later in the accounting accessibility

Steps 2: ledger creation

Benifit ledger creation
Trade benefits Short-term operation benefits long-term operation benefits paper benefits ultimate benefits

Trade benefits

The goods or services purchased for the purpose of sale are called trade benefits and the ledger account should be created in the name of those benefits and recorded in the account.

operation benefits

the product or service is purchased for the operation of the company, the use of that product must be calculated according to government law,

Government regulations for final account preparation Expenditures and income unrelated to the current account year should not be recorded in any company final account, and if such expenses and income are recorded in the final account, such transactions should be removed from the final account before the Income statement is published

short-term operation benefits

if the products or services used were less than one year then the ledger should be structured to indicate what benefit was received and for what purpose. Also, the exp symbol should be added to indicate that this transaction should be transferred to the profit and loss account.

long-term operation benefits

if the products or services used were more than one year then the ledger should be structured to indicate what benefit was received Also, the asset word should be added to indicate that this transaction should be transferred to the balance sheet.

Paper benefits

Paper is a valuable asset in the modern system. ledger should be created in the name of the paper benefit received or given. e.g, shares, bonds, discount,

ultimate benefits

If the benefit is digital money, create a ledger containing the bank name and account number. If there is physical money then a ledger should be created in the name of money.

personal ledger creation

If the name of the personal is known, the ledger should be created in the name of that person, if the name of the person is not known or if more than two beneficiaries are involved in this benefit transfer transaction, ledger must be created to refer to all of them.

Read the chapter on Why Personal Accounts important for more information

There is no separate ledger for sales transactions, the purchase ledger is used for sales. If there is no purchase for sale then the ledger should be created in the name of the good sold.

If you can't find a business benefit exchange. You can only memorize Account and not understand it.

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