General journal

The general journal is where double entry bookkeeping entries are recorded by debiting one account and crediting another account with the same amount. The amount debited and the amount credited should always be equal, thereby ensuring the accounting equation is maintained.

Depending on the business's accounting information system, specialized journals may be used in conjunction with the general journal for record-keeping. In such case, use of the general journal may be limited to non-routine and adjusting entries.

Format

A general journal entry includes:

The date of the transaction;
The title of account credited is indented several spaces
Titles of the accounts debited and credited;
The amount of each debit and credit; and,
An explanation of the transaction also known as a Narration.

Example

Acme, Inc carried out the following transactions in May 2009.

1 May: Received and paid telephone bill of $100 (cheque #0001)
4 May: Performed consulting services for Example LLP on credit, $350
6 May: Paid wages of $180
13 May: Example LLP paid for services performed on 4 May in full.
19 May: Performed consulting services for cash, $120
25 May: Purchased a computer for $2000. Paid $500 cash (cheque #0002), borrowed the remainder from the bank.

The above transactions may be journalized as follows:

Date	General ledger account title	Debit	Credit
May 01	Telephone expense	100
	Cash		100
	Paid telephone bill

04	Accounts receivable	350
	Consulting services revenue		350
	Performed consulting services for Example LLP

06	Salary expense	180
	Cash		180
	Paid salaries for April 2009

13	Cash	350
	Accounts receivable		350
	Received payment from Example LLP for services performed on 4 May

19	Cash	120
	Consulting services revenue		120
	Received cash for consulting services performed

25	Computer	2000
	Cash		500
	Loan payable		1500
	Purchased computer