Following two ways are used to teach Journalising and Ledger Posting

Following two ways are used to teach Journalising and Ledger Post­ing.

(i) On the basis of old system of teaching Book-keeping.

(ii) On the basis of new system of teaching Book-keeping

The Golden rules under the old system of Book-keeping are for personal A/c Real A/c and Nominal A/c. Similarly, the golden rule for new system is Assets, Liabilities and Capi­tal.

Under the new system, income and expenditure accounts are considered part of proprietorship account.

For every debit entry, there must be corresponding one or more credit entries, that are equal to the amount of the debit entry and vice- versa.

Purpose of journalizing

The basic purpose of journalizing is that it enables a businessman or a person to get a clear picture of each day business transactions. It helps him in:

(1) Locating a specific transaction

(2) Tracing the related debit and credit entries arising from a particular transaction.

(3) Furnishing to him the daily volume of transactions.

(4) Enabling him to compare one particular clay’s business with any another day’s business.

(5) Making it possible to find out and correct errors.

To avoid various difficulties that are encountered by directly registering entries to accounts, a particular type of record is kept. This daily record is known as a journal; and the process by which entries are made is known as journalizing Journal emanates from the French word ‘Jour’ which means ‘day’. This journal is known as book-keeper’s diary or the day-book. In this day-book the entries are entered in a chronological order.

In this system it is important to bear in mind that entry is made is the journal before it is written in individual accounts. Journal entry is the first record of transactions and so it is referred to as ” the book of original entry”.

Procedure of Journalizing

It is possible to split up the whole process of journalising into the following four steps:

(i) Recording date in the date column.

(ii) Recording the name of the account debited and its amounts.

(iii) Recording the name of the account credited and its amounts.

(iv) Recording explanation in the explanation column.

To teach, the teacher can make use of the form given below:

This chart is not used in day-to dky teaching but it definitely helps the student in analysing the transaction and guiding and stu­dents, thinking »

Teaching Procedures

Step : 1

(i) Write year in small figure at the top left of the divided date column.

(ii) Write month column below the year.

(iii) Write the day of the month in the second part of the day column.

(iv) Write the date of the month for every transaction.

(v) Do not repeat the month and the year. It is only written in the beginning of each page when there is a change of months or year.

STEP: 2

1. Write the debit account title very close to the line separating the date column and the account title column;

2. Head this account as debit account. The short form of which is ‘Dr.’ in lieu of ‘Debit’;

3. Keep proper even margins and columns.

STEP:3

Teaching Procedures in the Third Step

1. Write the credit account title on the second line by leaving about half an inch.

2. Head this account as the credit account, the short form of which is *Cr.’ in lieu of ‘Credit’.

3. Enter the credit amount in the second money column which is headed credit amount.

STEP: 4

Teaching Procedures in the Fourth Step

1. Write explanation on the third line, leaving about half an inch from the credit Account title.

2. Mention the reason for debit and credit entries in short.

STEP : 5 Arrow marie to L.Ref.