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What Is a General Journal in Accounting? - Definition, Format & Examples

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  • 0:00 The General Journal
  • 0:42 Format
  • 2:45 Lesson Summary
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Lesson Transcript
Instructor: Jay Wagner
The general journal is usually the first of a company's accounting records that we learn about and use, but it can also be one of the most misunderstood. It doesn't have to be difficult, though, as we'll show here.

The General Journal

Many of us keep journals or diaries where we record various events in our lives. Our journals usually remind us of the date that the event happened, what happened, who shared the experience with us, and any profound effects the experience may have had on us.

The general journal is the accounting version of our personal journals. It doesn't record everything that happens to the business, of course, but it does record every financial transaction that takes place (sometimes alone, sometimes as a group of similar transactions). Like our personal journal entries, it notes the date, the accounts involved, and the amounts of money, as well as providing a brief description of what happened.

Format

Let's take a look at the format of a general journal.

The General Journal

On the left are two columns for the date. To save writing, accountants and bookkeepers using manual journals generally enter the year and month only when they change but enter the day with each entry.

Next is a column for account titles and explanations. Sometimes the account numbers are placed with the titles, though this is, to some extent, a matter of choice on the part of the accountant or bookkeeper. The column titled Post Ref (short for posting reference) is used to show what page the information was copied to when the transaction was posted to the ledger.

The Debit and Credit columns are where the dollar amounts go. The total dollars in the debit column must equal the total dollars in the credit column in every journal entry. As long as that happens, we can use as many accounts as we need on either side of any journal entry and everything will still balance.

Below each entry it is customary (and sensible) to enter a short description of what happened in this transaction. This, again, is like our personal journals. Imagine making an entry to your personal journal like:

June 19, 2014, went to the lake. Ted and Angela came along.

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