4. Journal Entries Flashcards
What are journal entries used for?
A journal entry is a way of presenting the required double entry (debits and credits) for a transaction.
Any transaction can be represented by a journal entry. However, journal entries are generally used to record unusual or one-off transactions, such as the correction of an error.
Write out the format of a journal entry.
What should accompany a journal entry and why?
Write out the format of a journal entry.
A narrative explanation should accompany each journal entry. It is required for audit and control, to indicate the purpose and authority of every transaction.
How does a computerised accounting system process a journal entry if the debit entries do not match the credit entries?
A computerised accounting system will not allow a journal entry to be processed if the debit entries do not equal the credit entries.
