CAT / FIA FFA Syllabus C. The Use Of Double-entry And Accounting Systems - Uses of journals - Notes 1 / 3
Journal Book
The journal keeps a record of unusual movement between accounts.
It is used to record any double entries made which do not arise from the other books of prime entry.
For example, journal entries are made when errors are discovered and need to be corrected and for period end adjustments (depreciation, bad and doubtful debts, accruals and prepayments).
The format of a journal entry is:
| debit | credit | |
| $ | $ | |
| account to be debited | ||
| account to be credited | ||
| narrative to explain the transaction | ||
Memorandum Ledgers
The main purpose of memorandum ledgers is to know how much is owed by each particular customer or to a specific supplier at a point in time.
There are two main types of memorandum ledgers
Receivables Ledger
Payables Ledger
Receivables Ledger
This ledger shows how much is owed to the business by each individual customer
| sunshine co | ||||
| date | narrative | sales | cash | total |
| $ | $ | $ | ||
| oct 4 | invoice 145 | 452.60 | 452.60 |
| clouds co | ||||
| date | narrative | sales | cash | total |
| $ | $ | $ | ||
| oct 4 | invoice 146 | 254.20 | 254.20 |
| star & moon co | ||||
| date | narrative | sales | cash | total |
| $ | $ | $ | ||
| oct 4 oct 12 | invoice 147 | 845.90 | 750.00 | 845.90 95.90 |
Payables Ledger
This ledger shows how much is owed by the business to each individual supplier.
| jupiter co | ||||
| date | narrative | cash | purchase | total |
| $ | $ | $ | ||
| oct 1 oct 5 | invoice j851 cash book | 250.00 | 556.10 | 556.10 306.10 |
| mars co | ||||
| date | narrative | cash | purchase | total |
| $ | $ | $ | ||
| oct 1 | invoice m048 | 189.60 | 189.60 |
| venus & co | ||||
| date | narrative | cash | purchase | total |
| $ | $ | $ | ||
| oct 1 | invoice 0124 | 245.50 | 245.50 |