Accounting Cycle
Step 2: Journalize
The process of recording transactions into a journal is called journalizing.
You must include the date, the debit entry, the credit entry, and the source document for each transaction. To analyze whether the entry is a debit or a credit, refer to the Analyzing Transactions diagram.
Click on "Transactions Analysis Steps" to see how to discover whether an entry is a debit or a credit.
Step 1: Which accounts are affected? (Refer to the account titles and place on T-accounts.)
Step 2: What types of accounts are these?
Step 3: What does the T look like for this type of account? Rrefer to
"Analyzing the Balance Sheet" in the Toolkit.)
Step 4: Are these accounts increasing or decreasing?
Step 5: Are these accounts debits or credits?
For an example of a journal entry, refer to the journalizing example below.
Microsoft product screen shot(s) reprinted with permission from Microsoft Corporation.