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UNDERSTANDING JOURNAL ENTRIES


 

Understand the Direction
Do not be in a hurry to record Journal Entries. 
Read the directions carefully. Be sure to underline the important dates, amounts, and problem  requirements.
 

 
 

Understand Business Activity
Accounting transactions describe a business activity. To record this activity you must understand it thoroughly. State the given data and do the math calculations. If an earlier Journal Entry is involved, make it part of your analysis.
 

 
 

Helpful Organize Information
Try to arrange data in an organized fashion.
Summarize data in balance sheet arranged T accounts.
Show formulas and mathematical steps. 
 

 

 

Recording Steps
Record finance cash, receivable, payable.
 Record why the financing occurred 
assets purchased,  expenses incurred or revenue earned .

Make sure debits equal credits

 

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