Chapter 12. Keeping Track with Journals and Ledgers
Financial accounting means recording each and every event (transaction) that has a financial impact on the enterprise. By keeping track of these activities just as they happen, the accountant can easily summarize the firm’s financial position and issue financial statements. Journals and ledgers are “the books” in which accountants scribble transaction entries.
A journal is a book (or computer memory) in which all of a company’s financial events are recorded in chronological order. Everything is there, there is nothing missing. Journal entries can (and must) be made if:
1. We know with reasonable certainty the amount of money involved.
2. We know the timing of the event.
3. An actual exchange ...
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