Recording of Transactions

Points to Remember

  • A transaction is an event or happening that changes an organisation’s financial position and/or its earnings.
  • A source document or voucher is a document which provides evidence of a company’s transaction.
  • The accounting equation is: Assets= Liabilities + Capital.
  • Journal is a day book or daily record wherein the transaction are recorded in chronological order.
  • The process of recording transactions in the journal is called journalising.
  • Ledger is a book of final entry and it contains all the accounts of a business or all the accounts of a particular type.
  • The process of transferring journal entry to individual accounts is called posting.

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