Transactions classification

[Muhammad Sajid]

Greetings to everybody. I hope to find you all in best of health and safety. Today my query is regarding a particular accounting excel sheet prepared by someone else for me some times ago. The person created different general journals for different objectives. Like Sales and Purchases Journals for sales and purchases on credit and Cash Journal for cash Transactions. He created a general journal also about which I don't know what kind of transactions I should/could record there. I operate a business to supply Livestock meat to different customers. I'll be highly obliged as I've just started to input business data into a computer and I've minimal knowledge of accounting up till now.
Thanking You All In Anticipation.

 

[DrStrangeLove]

Hi Muhammad--

The general Journal is where you record most kinds of transactions. It's the journal used to create the financial statements.

The Sales, Purchases and Cash journals that person set up are subsidiary journals. Subsidiary journals are used to consolidate types of transactions that are frequent, to minimize the use of the general journal. The Sales journal, for example, holds the all the details of all the sales transactions. When you close the books, you can move the total of all sales into the general journal with one entry, rather than making hundreds or thousands of general journal entries all of the same type.

I'd suggest picking up a good introductory/intermediate textbook on accounting to describe the details of general vs. subsidiary ledgers.

 

[Muhammad Sajid]

thank you DrStrangeLove

 

[Muhammad Sajid]

thank you DrStrangeLove