AIOU SOLVED ASSIGNMENT 1 CODE 438 PRINCIPLES OF ACCOUNTING
2015 autumn solved assignment no 1 for course code 438 means principles of accounting is being presented to the B.com and B A level students of open university Islamabad.
Q 01:- Definition Of General Journal:- The general journal is an accounting log book that contains a complete listing of a company’s recordable transactions documented in chronological order. Also known as “the book of original entry,” the log uses double-entry bookkeeping and lists the date, the accounts involved, and the amount that each account should be credited or debited. While the general journal provides a complete listing of transactions, it provides no information about the balance of any account. Account balances are tabulated when the general journal entries are subsequently posted to their respective accounts in the general ledger.
OBJECTIVES OF THE JOURNAL
The following are the main objectives of journal
o Journal is prepared to keep a systematic record of financial transactions.
o Journal is prepared to show financial transactions in chronological order.
o Journal is prepared to present necessary information about the financial transactions.
o Journal is prepared to use as a legal evidence of financial transactions.
o Journal is prepared to facilitate the preparation of ledger book.
FEATURES OF THE JOURNAL
The following are the features of journal:-
• Journal is a book of original entry because transaction is recorded at first stage in this book.
• Journal is the first step in the recording process of double entry system of book keeping.
• Journal is also known as day book or diary because transactions are recorded in it on day to day basis as and when they take place.
• Journal is a chronological record of all transactions taking place according to the order of occurrence.
• Every entry in journal is accompanied with narration which describes, briefly, true nature and context of the transactions.
• Amount of the transaction is recorded in both debit and credit column-side by side. It helps in maintaining arithmetical accuracy of the books.
• Journal and ledger are inter linked because next step after journal is the ledger.