Definition of Journal
Journal is one of the major books of account. It is simply defined as the book of original/first entry. It is thus defined because every business transaction is recorded first in the Journals before being transferred to the Ledger and other books of account. Journal is also called Day Book or Subsidiary book.
Types/Classification of JOURNAL
There are 6 types of JOURNAL classified under two headings, namely:
A. The Special Journals:
1. Purchases Journal
2. Sales Journal
3. Returns Outwards Journal
4. Returns Inwards Journal
5. Cash Journal/Cash Book
B. The General Journal
6. Journal Proper
Uses of Journals
1. Purchases Journal: Used for recording the purchase of goods meant for resale (business stock) on credit.
2. Sales Journal: Used for recording the sales of goods (business stock) on credit.
3. Returns Outwards (Purchases Returns) Journal: Used for recording purchased goods returned to the suppliers/creditors.
4. Returns Inwards (Sales Returns) Journal: Used for recording sold goods returned by the customer/debtor.
5. Cash Book: Used for recording all cash transactions.
6. Journal Proper: This is a multi-purpose Journal, used for many bookkeeping records, namely:
a. Sales of Fixed Assets on credit
b. Purchases of Fixed Assets on credit
c. Opening and closing entries
d. Correction of errors
e. Every other transactions that cannot go through the special journals
f. Entries that can go through the special journals.