How Do You Prepare A Journal Entry?
While you’re keeping track of your business funds, you must be organized with your journal entries. By keeping track of the debits and credits for supplies, business expenses, insurance, cash, revenue, bank charges and any other form of monetary exchange, you can continually track your financial situation. Your monitoring system starts with the journal entry. Step 1 Record the date, including the year, and time of the entry in the first column. Dating your entries makes for an easy way to find a specific entry later. Step 2 List the account used for the transaction. Note whether the exchange came from sales, cash, insurance, business expenses or another type of account. Keep this short, using abbreviations and account nicknames. For clarity, list all possible accounts on a separate page for the reader to reference. Step 3 Note whether the transaction was a debit or credit. A debit indicates money was taken from the account to pay a debt. A credit indicates money was put into the accoun
