Home › ACCA › Financial Accounting › The Mechanics of the Accounting Process › When journalizing a transaction, which account i…
When journalizing a transaction, which account is conventionally entered first and on which line?
AThe debited account, on the first line
BThe credited account, on the first line
CThe larger amount, on the second line
DThe cash account, on the first line
Answer & Solution
Correct answer: A. The debited account, on the first line
1. Journalizing rules require the debit entry to always be listed first.
2. The account being debited goes on the first line with its amount in the Debit column.
3. The credited account goes on the second line, indented, so option A is wrong.
4. Ordering is by debit/credit, not by amount size or whether it is cash, ruling out C and D.
5. Therefore the debited account is entered first.
_Source: Jonick, Principles of Financial Accounting (CC BY-SA 4.0), §1.3.3 "Journalizing Transactions", p.14_
Related questions
A trial balance shows Cash $3,000, share capital $2,000, Fees Earned $1,900, and Supplies What is meant by the "normal balance" of an account?A Cash ledger shows these postings in order: debit 6,000; credit 2,000; credit 1,000; debiWhen posting, what should never appear as a running balance in a ledger account?A Cash ledger has a running debit balance of $5,000. A credit entry of $1,200 is posted. WThe process of copying entries from the journal to the ledger is called:What is the defining difference between the journal and the ledger?On 5 June a customer pays $800 cash for a service the company provided that day. What is t