Difference between JOURNAL and LEDGER

   

The word “journal” has been derived from word French”Jour” its means that a day and that is name as journal its means a daily. Transactions are daily recorded in the journal and it is in detail on”DAY BOOK” in this book daily transaction was recorded. It has following features:

1.   Transaction is first all of recorded in the general journal and its first step of double entry system it is called book of original Entry.

2.   A transaction is first recorded on the same day of day book that is Day Book and Chronological Book.

For each transaction they have two concerned accounts these are first Debited and second are credited. These are also post in ledger that is “Subsidiary Book”.

Whereas,

    The ledger is the king of all book accounts because all the transactions and entries from the book of original entry it must be post in ledger book. Ledger has contains classified record of all transactions. All transactions are related to cash it must be put in one place and all transactions with a customer or supplier must also be assembled at one place. The book in which transaction is classified that is ledger.

Features and advantages of ledger:

The following features and advantages are derived from ledger:

1. It has two left side shows Debit and right side shows Credit. All Debit aspect transactions is recorded on Debit side, while Credit aspect transactions is recorded in Credit side according to date.
2. The difference of both sides represents there balances. The excess of Debit side is over from credit that shows debit balance, while the excess of credit side is over from Debit that shows credit balance. If total of both two sides is equal, there will be no balance.
3. The balance is drawn at the end year and recorded on the deficit side to make the two sides equal that is known as closing balance. The closing balance of the current year will be the opening balance of the next year and so on.
4. It is the through which successful application of Double entry system is ensured. Each and every transaction is divided into two parts Receiver and Giver and this is recorded in to two concerned accounts in ledger Book.
5. Transactions relating with different persons or concerns are recorded in the account of each persons or concern separately. As a result, complete and reliable and available in each and every account. Separate account is opened for each item of assets and liabilities. Transactions recorded primarily in journal and then final in ledger.

Ledger:

The ledger is the king of all book accounts because all the transactions and entries from the book of original entry it must be post in ledger book. Ledger has contains classified record of all transactions. A ledger is the principal book or computer file for recording and totaling monetary transactions by account, with debits and credits in separate columns and a beginning balance and ending balance for each account. All transactions is related to cash it must be put in one place and all transactions with a customer or supplier must also be assembled at one place.

Rules for journalizing:

The transactions which is act of recorded in journal that is journalizing. The rules of journalizing are as follow:
1.  First use two separate lines for writing the names of two accounts concerned in all transactions.
2.  First we show the date of entry and particular then write the names of debtor or account to be debited which is write in first line and the creditor name of account is to be credited in second line.
3.  Write the name of which is debited the line starting the particular column and that of account to be credit which is short distance from next line.
4.  The term “Dr” is debited shows and “Cr” shows the credit line. One line shows one entry in particulars column only. The line doesn’t extend the amount of column.

 

 

 GENERAL JOURNAL

The word”journal” has been derived from word French”Jour” its means that a day and that is name as journal its means a daily. Transactions are daily recorded in the journal and it is in detail on”DAY BOOK” in this book daily transaction was recorded. It has following features:

1.  Transaction is first all of recorded in the general journal and its first step of double entry system it is called book of original Entry.

2.  A transaction is first recorded on the same day of day book that is Day Book and Chronological Book.

3.  For each transaction they have two concerned accounts these are first Debited and second are credited. These are also post in ledger that is”Subsidiary Book”.

Features and Classification of accounting principles:

These are the features of accounting principles and classifications,

1.  Usefulness

2.  Objectivity

3.  Feasibility

4.  Accounting concepts

5.  Accounting conventions    

Accounting Principles and Accounting Equations:

Accounting is the language of business and their affairs of a business it is unit are made  understood to others as well as its information’s which has to be suitably recorded, classified, summarized and presented its results in last results and it  is make the convey the same meaning to all peoples in business. It has necessary that it should base on certain uniform scientifically laid down standards these standards are the termed as accounting principles. It is rules of actions where accounting records his transactions. Therefore, Equation is a dual aspect they may be stated as “for every debit, there is a credit”. Every transaction has same extent amount this concept may also called Accounting equation. All transactions points of time assets of entity both are same and equal and there sum of properties are equal and it is owned by the business. This formula is known as accounting equation,

ASSET = OWNER,S EQUITY

        OR  
ASSET = LIABILITIES

Objects of Book Keeping:
The main objects of book keeping can be as follow.

1. It must provide a permanent and systemic records of all business transactions.
2. The periodical results as to profits or loss should be readily and accurate ascertainable
3. It has enable financial data to supplied for management of the business.
4. The entries and narrations should chearily show the nature and effect of all taken together.

Some Important Terms in Account Book Keeping:

• Transactions
• Capital
• Accounts
• Proprietor
• Drawings
• Purchases
• Purchase return
• Sales 
• Sale return
• Trade dis
• count
• Cash discount
• Commission
• Expenditure
• Expenses
• Debtor
• Creditor
• Assets
• Liabilities
• Owner equity
• Proprietor ship
• Bill receivable
• Bill payable

BOOK-KEEPING

The art and science recording correctly in business transaction of all accounts in such a systemic way of trader may know the result of trade at the end of a certain time period or the financial results and may also prove the accuracy of such transactions.

Book keeping primarily deals in the art of recording transaction in book.

Accounting cycle is art of recording,processing,classifying,summarizing,analyzing, and interpreting between those select items that is accounting cycle.