what are advantages and disadvantages of a journal entry in outlook?
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Answer:
In journal day book we record transactions in their chronological order. The process of recording transaction in a journal is known as ‘Journalisation’. The entry recorded in this book is a ‘journal entry’. Journal is the book of primary entry in which we record all transactions before posting them into the ledger. We need to keep a journal in a columnar form. There are some function and advantages of journal day book. Now we are going to discuss the Journal – Functions and Advantages.
- Functions of Journal
- (i) Analytical Function: While recording a transaction in the journal each transaction is analyzed into the debit aspect and the credit aspect. This helps to find out how each transaction will financially affect the enterprise.
- (ii) Recording Function: Accountancy is a business language which helps to keep the record of the transactions based on the principles. Each such recording entry is supported by a brief narration, which explains, every transaction in simple language. Narration means to narrate – i.e. to explain. It starts with a word – Being …
(iii) Historical Function: Journal book contains a chronological record of the transactions for future references.
- Advantages of the Journal
The following are the advantages of a journal:
(i) Chronological Record: Journal book records transactions as and when it happens. Therefore it is possible to get day-to-day information.
(ii) Minimizing the possibility of errors: The nature of the transaction and its effect on the financial position of the business is ascertained by recording and analyzing into debit and credit aspect.
(iii) Narration: It means the explanation of every recorded transaction.
(iv) Helps to finalize the accounts: It is the basis of ledger posting and the ultimate Trial Balance.
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- Journal – Functions and Advantages
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- In journal day book we record transactions in their chronological order. The process of recording transaction in a journal is known as ‘Journalisation’. The entry recorded in this book is a ‘journal entry’. Journal is the book of primary entry in which we record all transactions before posting them into the ledger. We need to keep a journal in a columnar form. There are some function and advantages of journal day book. Now we are going to discuss the Journal – Functions and Advantages.
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- Functions of Journal
- (i) Analytical Function: While recording a transaction in the journal each transaction is analyzed into the debit aspect and the credit aspect. This helps to find out how each transaction will financially affect the enterprise.
- (ii) Recording Function: Accountancy is a business language which helps to keeps the record of the transactions based on the principles. Each such recording entry is supported by a brief narration, which explains, every transaction in simple language. Narration means to narrate – i.e. to explain. It starts with a word – Being …
- (iii) Historical Function: Journal book contains a chronological record of the transactions for future references.
- Browse more Topics under Books Of Prime Entry
- Sub Division of Journal
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- Sub Division of Ledger
- Learn more about Journal Entry here in detail.
- Advantages of the Journal
- The following are the advantages of a journal:
- (i) Chronological Record: Journal book records transactions as and when it happens. Therefore it is possible to get day-to-day information.
- (ii) Minimizing the possibility of errors: The nature of the transaction and its effect on the financial position of the business is ascertained by recording and analyzing into debit and credit aspect.
- (iii) Narration: It means the explanation of every recorded transaction.
- (iv) Helps to finalize the accounts: It is the basis of ledger posting and the ultimate Trial Balance.
- advantages of Journal
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