Question

Needs and importance of journalising household transactions from a month

Answer 1

The following are the importance of journal:-

Each transaction is recorded as soon as it takes place. So there is no possibility of any transaction being omitted from the books of account.

Since the transactions are kept recorded in journal chronologically with narration, it can be easily ascertained when and why a transaction has taken place.

For each and every transaction which of the two concerned accounts will be debited and which account credited, are clearly written in journal. So, there is no possibility of committing any mistake in writing the ledger.

Since all the details of transactions are recorded in journal, it is not necessary to repeat them in ledger. As a result ledger is kept tidy and brief.

Journal shows the complete story of a transaction in one entry.

Any mistake in ledger can be easily detected with the help of journal.