Accounting Demystified

Journalize

Journalizing is the process of taking transactions and turning them into a form (a journal entry) that can be captured by the financial accounting system. Not everything that happens in the course of a business day requires that a journal entry be made. If you get a letter from a customer praising your product, no journal entry is required. If a customer calls and asks your hours of operation, no journal entry is required. A journal entry is required only when there is a change in an account balance.

With the journal entry, we get into debits and credits. Debits and credits are the left-hand and right-hand sides of a journal entry. They are also a standard shorthand way of saying whether we are increasing or decreasing the balance ...