Journal entries

System
System Posts: 100,534 🤖 Admin 🤖
edited 10:31AM in AAT student discussion
Hiya

im retaking my PLB on Tuesday and having trouble with journal entries, anyone got any tips on how to understand them better?

Any help would be much appreciated!!

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Journal entries

    Just remeber the basic rule debit the account from which you recieve and credit the aCCOUNT FROM WHICH YOU GIVE.
    if you have posted a payment on gas but should be elec.. the entries would be as follows:
    to begin with the error would be
    Gas Dr CR
    200
    Elec 0
    Gas 200 (This has now been cancelled out)
    Elec 200
    Hope this helps
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Journal entries

    Hi

    I think the easiest way of doing journals is to start by correcting the entry that is incorrect i.e....

    £200 were debited to the Electric account instead of the motor expenses account.

    Electric account Credit £200
    Motor expenses Debit £200

    The rule is that if the entry to correct the error does not affect the TB then you do not need to use a Suspense Account. If it does affect the TB (does not balance) then you would do the following;

    £200 paid for Electric was correctly entered into the bank but no other entry were made;

    Electric Debit £200
    Suspense Credit £200

    Hope this helps, good luck

    Sinders
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Journal entries

    Hi

    I think the easiest way of doing journals is to start by correcting the entry that is incorrect i.e....

    £200 were debited to the Electric account instead of the motor expenses account.

    Electric account Credit £200
    Motor expenses Debit £200

    The rule is that if the entry to correct the error does not affect the TB then you do not need to use a Suspense Account. If it does affect the TB (does not balance) then you would do the following;

    £200 paid for Electric was correctly entered into the bank but no other entry were made;

    Electric Debit £200
    Suspense Credit £200

    Hope this helps, good luck

    Sinders
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Journal entries

    I find just roughly drawing out the T accounts involved with only the incorrect entries in is quite useful. Then put the entries in to fix the error. This makes seeing what needs to be done to put things right much easier.

    Journals figure quite heavily in Unit 5 FRA so at least that's one thing I'll know how to do on Wednesday :)

    Chris

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