Question

Recording business transaction in the journal is known as posting.

• A. True
• B. False

Answer 1

The correct option is B False

Journalising is the process of recording the aspects of the transactions in journal. In other words, recording of entries in the journal is known as journalising.

The process of journalising means the steps to be followed for ascertaining the account heads to be debited/credited for a particular transaction. There are three steps involved in the process of journalising a transaction:

Step 1: Identification of accounts or 'account heads' affected by the transaction.

Step 2: Classification of accounts or account heads.

Step 3: Application of rules for debit and credit.