Question

Every financial transaction is recorded first in the journal.

• A. True
• B. False

Answer 1

The correct option is A True

A transaction is recorded first in a journal because journal provides complete details of a transaction in one entry.

Further, a journal forms the basis for posting the transactions into their respective accounts into ledger.

Transactions are recorded in journal in chronological order, i.e. in the order of occurrence with the help of source documents.

Journal is known as 'book of original entry', because with the help of source document, transactions are originally recorded in books. The process is of recording the transactions in journal and then in ledger.