How is a journal different from a general ledger in accounting
Recording a journal and a general ledger are both important tools in accounting used to record financial transactions. But they serve different purposes and have some key differences.
A journal is the first place where financial transactions record. It alternatively refer to as the primary book of record. In a journal, transactions record in chronological order as they occur. Each entry in the journal includes the date of the transaction, a description of the transaction, the accounts affected, and the amount debited or credited to each account.
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A general ledger, on the other hand, is a record of all the accounts used by a business, such as cash, accounts receivable, accounts payable, and so on. It is a book of final entry. In a general ledger, all transactions summarize and classify into different accounts based on their nature. Each account in the ledger assign a unique identification number, and all transactions related to that account recorde in that account.
The main difference between a journal and a general ledger is that a journal use to record transactions as they occur, while a general ledger use to summarize and classify all transactions based on the nature of the account. In other words, a journal is a temporary record, while a general ledger is a permanent record that provides a summary of all transactions.
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