Journalizing

Definition

Journalizing is the process of recording financial transactions in a journal. Each entry must include the date, accounts affected, amounts, and a brief description.

5 Must Know Facts For Your Next Test

1. Journal entries are the first step in the accounting cycle.
2. Entries must be made in chronological order.
3. Each journal entry affects at least two accounts due to double-entry accounting.
4. Debits and credits must always balance in each journal entry.
5. A general journal is often referred to as the book of original entry.

Review Questions

Related terms

Double-Entry Accounting:

A system that records each transaction as both a debit and a credit in separate accounts.

General Ledger:

A complete record of all financial transactions over the life of a company.

T-Accounts:

Visual representations of individual accounts that show debits on the left side and credits on the right side.