Recording each transaction directly in the general ledger may become cumbersome and unnecessary. Instead, transactions can be recorded in special journals and totals can then be posted to subsidiary ledgers and then general ledger.
A special journal is used to record similar types of transactions.
There are multiple special journal types. Let’s review some of them.
A sales journal is used to record sales transactions. This type of journal is used to accumulate information about sales on account. For example, if a company sells a product for $100 on account, it will be recorded in the sales journal
Cash Receipts Journal
A cash receipts journal is used to record cash receipts. Such receipts may include cash from sales of merchandise, collection of balances due from customers and so on.
A purchases journal is used to record purchases of merchandize/inventory. When a purchase on account is made, it is recorded in this journal.
Cash Payments Journal
A cash payments journal is used to record cash payments. When a company pays for merchandize purchased on account, for supplies, etc., such payments are recorded in the cash payments journal.
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