Cash disbursement journal definition

What is the Cash Disbursement Journal?

The cash disbursement journal is a detailed record of the cash payments made by a business. The journal itemizes when checks and other types of payments are made, as well as the amounts paid, the names of the recipients, and the accounts charged. This journal is a good source document for tracking down the specifics regarding individual payments. The information in the cash disbursement journal is periodically summarized and forwarded to the general ledger.

Reconciling the Cash Disbursement Journal

You should compare the ending balance in the cash disbursement journal to the related ending balance in the general ledger as part of the month-end closing process. If there is a disparity, there are two possible causes, which are as follows:

  • Unposted entries. The disparity may be caused by additional entries piling up in the journal that were not posted to the general ledger.

  • Direct entry to general ledger. It is possible that a journal entry was made directly to the general ledger account that was not also entered in the journal.

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