General journal description | Entries | Example
/What is the General Journal?
The general journal is part of the accounting record keeping system. When an event occurs that must be recorded, it is called a transaction, and may be recorded in a specialty journal or in the general journal. There are four specialty journals, which are so named because specific types of routine transactions are recorded in them. These journals are the sales journal, cash receipts journal, purchases journal, and cash disbursements journal. There could be more specialty journals, but the four accounting areas represented by these journals contain the bulk of all accounting transactions, so there is usually no need for additional journals. Instead, by default, all remaining transactions are recorded in the general journal. Once entered, the general journal provides a chronological record of all non-specialized entries that would otherwise have been recorded in one of the specialty journals.
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Examples of General Journal Entries
Examples of transactions recorded in the general journal are asset sales, depreciation, interest income and interest expense, and stock sales and repurchases.
Journal Entry Format
Transactions are recorded in all of the various journals in a debit and credit format, and are recorded in order by date, with the earliest entries being recorded first. These entries are called journal entries (since they are entries into journals). Each journal entry includes the date, the amount of the debit and credit, the titles of the accounts being debited and credited (with the title of the credited account being indented), and also a short narration of why the journal entry is being recorded.
Example of a General Journal Accounting Entry
An example of a journal entry that would be recorded in the general journal is:
| Date | Account | Debit | Credit |
| June 30 | Depreciation expense | 10,000 | |
| Accumulated depreciation | 10,000 | ||
| To record depreciation for the month of June | |||
Journal Process Flow
After the transactions are recorded in these journals, a summary of all the transactions is posted in each journal to the general ledger, which contains all of a company's accounts. An account is a separate, detailed record associated with a specific asset, liability, equity, revenue, or expense item. Examples of accounts are:
Accounts Receivable (an asset account)
Accounts Payable (a liability account)
Retained Earnings (an equity account)
Product Sales (a revenue account)
Cost of Goods Sold (an expense account)
In summary, an accounting transaction is recorded into a journal, and then the information in the journal is posted into the accounts which are stored in the general ledger. The general journal is the repository for transactions that are not recorded in a specialty journal. Thus, the general journal can be considered an intermediate repository of information for some types of information, on the way to its final recordation in the general ledger.
Other General Journal Issues
The general journal was more visible in the days of manual record keeping. With nearly everyone now using accounting software to record their accounting transactions, it is not so readily apparent. Instead, the software makes it appear as though all transactions center around the general ledger, with no specialty journals in use at all.
General Journal vs. General Ledger
A general journal is the primary journal in which lower-volume accounting transactions are recorded, while the general ledger contains a summary of every recorded transaction. A key difference between the two is that the general journal contains a larger amount of detailed accounting information than the general ledger for specific transactions, while the information in the general ledger is stored at a more summary level, and for all types of transactions.
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The Difference Between the General Ledger and General Journal