In the world of accounting, you must be familiar with the term financial journal. This financial journal is part of the accounting cycle and one of the tools for classifying transactions. There are several types of journals that accountants use in their books, including special journals, adjusting journals, and general journals. Each – each of these journals has its respective functions. The function of the journal itself is to record all transactions, both cash, and non-cash. Journals are also used as a store for historical transactions which are recorded periodically and sequentially. The journal can also be used as an information tool for incoming and outgoing transactions. Meanwhile, if you need experts to handle your bookkeeping process, you can hire the best XERO and MYOB Expert Sydney Amanda.
Here are some examples of journals in accounting:
A special journal is a journal that is used to classify special transactions such as credit purchases, credit sales, or cash in and cash out.
A general journal is a journal that is used to record all financial transactions. You can also record goods return transactions in this journal. The general journal is very simple because it only consists of a date column, account number, account description, and a credit debit column. recording transactions can only use general journals without the need to use special journals, but accounting for trading companies is more efficient if they have special journals in their books.
Adjusting journal entry
An adjusting journal is made at the end of the period which aims to record the adjustment transaction. The adjusting journal is also needed to update your inventory data after stock taking. With adjusting journals, balances in your financial data can show real-time data and can correct recording errors.
The purpose and function of the closing journal are so that the capital account shows an amount appropriate to the conditions at the end of the period and can present the initial balance for the next period after the closing of the book.
A reversing journal is a journal to reverse the adjusting journal so that it creates a balance sheet. The function of the reversing journal itself is to simplify the preparation of the journal at the end of the accounting period.