What is Journal in accounting – Basic Concept of Journal
What is Journal in accounting? A Journal is a record of financial transactions in chronological (date-wise, starting from the earliest to the latest date) order. Journal is also known as Book of Original Entry.
Given that there are various types of transactions, like purchases, sales etc, depending on the number of transactions, a business can maintain either one single journal record all the transactions, or where the number of transactions are higher, they can maintain one separate journal for each category of such transaction.
When, all the business transactions , are entered in one single journal, we call it a Simple journal.
However, business entities can also maintained separate journals for recording different type of business transactions like Purchases Journal, Sales Journal, Sales Return Journal etc.
Journal is also known as books of original entry because a financial transaction is first time recorded in the journal . Thereafter , such transaction can be posted to the Ledger.