How to Prepare Journal Entries for Accounting

by Kirk Thomason; Updated September 26, 2017

The general ledger is the primary accounting tool companies use to record business transactions. Journal entries represent business activities; accountants must record entries to enter the financial information into the general ledger. Recording journal entries is the first step in the accounting cycle. Each month, accountants record transactions through a series of journal entries. The trial balance includes all general ledger account with ending balances. The report allows accountants to ensure all asset accounts equal liabilities and equity accounts.

Step 1

Identify the type of transaction and which general ledger accounts it affects. Common journal entries relate to revenue, costs of goods sold, inventory accounts payable or receivable and expenses.

Step 2

Review the information that documents the transaction. Retrieve the dollar amounts associated with the transaction.

Step 3

Prepare a journal entry. Each entry requires a debit and credit, such as balance changes in two separate general ledger accounts. Dollar amounts should equal those in the associated paperwork.

Step 4

List the account number, account name and dollar amount for each debit and credit on separate line in the entry.

Step 5

Post the entry into the general ledger. Enter the dollar amounts into each account, along with a brief yet informative description of the transaction.


  • List debits first and credits second when writing journal entries.

    Journal entries for large dollar amounts or other significant entries may require authorization from an accounting supervisor.


  • "Fundamental Financial Accounting Concepts"; Thomas P. Edmonds, et al.; 2011

About the Author

Kirk Thomason began writing in 2011. In addition to years of corporate accounting experience, he teaches online accounting courses for two universities. Thomason holds a Bachelor and Master of Science in accounting.