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TASAccountingQuick questions
Financial Accounting
Quick questions on Recording Transactions: Journals and Ledgers - TCE Accounting (Tasmania)
4short Q&A pairs drawn directly from our worked dot-point answer. For full context and worked exam questions, read the parent dot-point page.
What are source documents?Show answer
Every entry should be supported by a source document, such as an invoice, receipt, cheque butt or bank statement. Source documents provide the evidence (objectivity) for the amounts recorded and the date the transaction occurred.
What is the general journal?Show answer
The journal is the book of original entry. Each entry lists the date, the account(s) debited, the account(s) credited (indented), the dollar amounts in debit and credit columns, and a short narration explaining the transaction. The debit is always written first.
What is the ledger?Show answer
The ledger is the collection of all individual accounts (Cash, Debtors, Sales, Wages and so on). Posting means transferring the debit and credit amounts from the journal into the matching ledger accounts. Each ledger account accumulates all the increases and decreases for that item, and its balance is the net figure.
What is the trial balance?Show answer
After posting, the balance of every ledger account is listed in a trial balance, with debit balances in one column and credit balances in the other. If the double-entry has been done correctly, the two columns are equal. A balanced trial balance confirms the arithmetic, but it does not prove there are no errors (for example, an entry posted to the wrong account of the same type will still balance).
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