This document defines and explains journals and ledgers in accounting. It states that a journal is a book of original entry that records daily transactions in the order they occur, while a ledger contains classified and permanent records of transactions posted from the journal. The key differences between journals and ledgers are outlined, such as journals being primary records and ledgers being secondary records. Examples of journal entries are provided to illustrate how transactions are recorded in the debit and credit format of a journal.

1. 19MST15 – FINANCIALAND
MANAGEMENT ACCOUNTING
M. NANDHAKUMAR
RESEARCH ASSISTANT
ERODE SENGUNTHAR ENGINEERING COLLEGE (AUTONOMOUS)
PERUNDUAI, ERODE

2. MEANING OF JOURNAL
•The word “Journal” has been derived from the French Word
“JOUR” meaning of daily records
•The journal records all daily transactions of a business in the
order in which they occur.
•Thus, journal is a book of original entry/ books of prime
entry.

3. DEFINITION OF JOURNAL
•According to Eric. L. Kohler., “The journal is a book of
original entry in which are recorded transactions not provided
for in specialized journals.”

4. MEANING OF LEDGER
•When the transactions are recorded form the primary books
of accounts on permanent basis under double entry system in
a summarized and classified form in different accounts and
the same is posted in separate pages, it is called Ledger.

5. DEFINITION OF LEDGER
•According to L.C. cropper, “The book which contains a
classified and permanent record of all the transactions of a
business is called subsidiary boos.

6. DIFFERENCE BETWEEN JOURNALAND LEDGER
BASIS OF
DIFFERENCE
 Nature of book
 Basis of preparation
 Stage of recording
 Object
 Balancing
 Narration
 Processing of recording entries
 Preparation of final accounts
JOURNAL
 It’s primary or prime entry.
 Its prepared on the basis of source
documents of transactions.
 Recording in the journal in the first
stage.
 Its prepared to record all transactions
in order.
 Journal isn’t balanced.
 Narration is written for each entry.
 The process of recording in journal is
called “Journalizing”.
 Directly doesn’t preparing of final
A/c
LEDGER
 Its book of final or secondary entry.
 Its prepared on the basis of journal
 Recording in the ledger is the second
stage.
 Its prepared to know the net effect of
various transactions.
 All ledger accounts (except nominal
account) are balanced in the ledger.
 No narration is given.
 The process of recording in the ledger
is called “Posting”.
 Basis for the preparation of final A/c.

7. FORMAT OF JOURNAL
Date Particulars L.F Dr. Cr.
• Date
• The transaction was entered is recorded here.
• Particulars
• Transaction recorded
• L.F – Ledger Folio
• Dr. - Debit
• Cr. - Credit

8. EXAMPLES OF JOURNAL ENTRIES
• Goods purchased for Rs.5,000
• Salary paid Rs.3,200
• Amount paid to Mohan Rs.10,000
Date Particulars L.F Dr. Cr.
15.11.202
0
Purchase A/c
Dr
To Cash A/c
(Being goods purchased for cash)
5,000
5,000
17.11.202
0
Salary A/c
Dr
To cash A/c
(Being salaries paid)
3,200
3,200
18.11.202
0
Mohan A/c
Dr
To cash A/c
(Being amount paid to mohan)
10,000
10,000

9. EXAMPLES OF JOURNAL ENTRIES
• Sold goods to Rajesh Rs. 2,000
• Old machinery sold Rs.3,200
• Amount received form Mohan Rs.10,000
Date Particulars L.F Dr. Cr.
15.11.202
0
Rajesh A/c
Dr
To Sales A/c
(Being goods purchased for cash)
2,000
2,000
17.11.202
0
Cash A/c
Dr
To Sales A/c
(Being salaries paid)
3,200
3,200
18.11.202
0
Mohan A/c
Dr
To cash A/c
(Being amount paid to Mohan)
10,000
10,000

10. Q & A