We are independent & ad-supported. We may earn a commission for purchases made through our links.
Advertiser Disclosure
Our website is an independent, advertising-supported platform. We provide our content free of charge to our readers, and to keep it that way, we rely on revenue generated through advertisements and affiliate partnerships. This means that when you click on certain links on our site and make a purchase, we may earn a commission. Learn more.
How We Make Money
We sustain our operations through affiliate commissions and advertising. If you click on an affiliate link and make a purchase, we may receive a commission from the merchant at no additional cost to you. We also display advertisements on our website, which help generate revenue to support our work and keep our content free for readers. Our editorial team operates independently of our advertising and affiliate partnerships to ensure that our content remains unbiased and focused on providing you with the best information and recommendations based on thorough research and honest evaluations. To remain transparent, we’ve provided a list of our current affiliate partners here.

What is a Journal Entry?

By Osmand Vitez
Updated Jan 29, 2024
Our promise to you
WiseGeek is dedicated to creating trustworthy, high-quality content that always prioritizes transparency, integrity, and inclusivity above all else. Our ensure that our content creation and review process includes rigorous fact-checking, evidence-based, and continual updates to ensure accuracy and reliability.

Our Promise to you

Founded in 2002, our company has been a trusted resource for readers seeking informative and engaging content. Our dedication to quality remains unwavering—and will never change. We follow a strict editorial policy, ensuring that our content is authored by highly qualified professionals and edited by subject matter experts. This guarantees that everything we publish is objective, accurate, and trustworthy.

Over the years, we've refined our approach to cover a wide range of topics, providing readers with reliable and practical advice to enhance their knowledge and skills. That's why millions of readers turn to us each year. Join us in celebrating the joy of learning, guided by standards you can trust.

Editorial Standards

At WiseGeek, we are committed to creating content that you can trust. Our editorial process is designed to ensure that every piece of content we publish is accurate, reliable, and informative.

Our team of experienced writers and editors follows a strict set of guidelines to ensure the highest quality content. We conduct thorough research, fact-check all information, and rely on credible sources to back up our claims. Our content is reviewed by subject-matter experts to ensure accuracy and clarity.

We believe in transparency and maintain editorial independence from our advertisers. Our team does not receive direct compensation from advertisers, allowing us to create unbiased content that prioritizes your interests.

A journal entry is an accounting transaction that records financial information into a company’s accounting ledger. Accounting ledgers are often made up of various journals. Types of accounting journals may include general, sales, purchases, cash receipts, and cash disbursements. The general journal contains all the financial information of the company, including aggregate totals from the other journals. Each journal entry that is recorded by the company usually contains a debit and a credit, based on the traditional double-entry accounting system used worldwide.

Journal entry information usually includes account numbers, a brief description of the transaction, dollar amount, and a specific reference number. This detailed information helps companies track the financial information recorded in the company’s various accounting journals. Traditionally, journal entries list all debits first, followed by the credits. This format creates a clear presentation for the financial information included in the entry. Journal entry ledger sheets may also include the initials of the accountant or accountants who have posted the journal entry or entries. This information provides accounting managers with an accurate audit trail when reviewing journal entries for accuracy and validity.

Several types of journal entries may be used by companies. Journal entries may include a basic entry, reversing entry, recurring entry, and adjusting entry. Basic entries usually represent the initial recording of specific financial information. These entries may be recorded as financial transactions occur or at the end of an accounting period. Companies usually set up an account policy to determine when basic journal entries will be recorded. The recording of basic journal entries depends on the number of entries, the size of the company, and the timeliness in which companies need to have financial information recorded.

Reversing entries may be used to correct basic entries that have been recorded inaccurately by an accountant. This type of entry may also set up accruals or deferrals that need to be reversed at a future time period. Companies may accrue or defer income, expenses, or other financial information based on accounting guidelines. Companies using automated accounting software often set up reversing entries using the software’s time delay feature.

Recurring journal entries usually record the same information each month in a company’s accounting system. These entries may be set up using a standard template that includes the account numbers and other general information for each month’s entry. The only information that changes in a recurring journal entry is the financial numbers.

Adjusting entries are used to correct the financial numbers or ledger accounts used in the basic journal entry. These entries may also be used to correct journal entries recorded in the wrong journal by accountants, or any information that needs to be corrected at a date after the basic journal entry has been recorded.

WiseGeek is dedicated to providing accurate and trustworthy information. We carefully select reputable sources and employ a rigorous fact-checking process to maintain the highest standards. To learn more about our commitment to accuracy, read our editorial process.
Discussion Comments
WiseGeek, in your inbox

Our latest articles, guides, and more, delivered daily.

WiseGeek, in your inbox

Our latest articles, guides, and more, delivered daily.