An opening journal entry is used to post the opening assets, liabilities, and equity of a business when it first establishes a double entry bookkeeping system.
Branch accounting is used by a business to assess the profitability of each of its branches. The simplest method is for the central head office to operate a single branch account for each branch. The method is sometimes referred to as the debtors system or direct method system.
As the number of bookkeeping transactions increases an accounting ledger needs to be split into various subsidiary ledgers. Self balancing ledger accounting is a method of entering two sided transactions in each ledger using adjustment accounts in order that a trial balance can be extracted from each of the subsidiary ledgers.
The sales return day book is used to record goods returned by customers. The sales return book is not part of the double entry posting and is simply a chronological list of credit notes issued to customers and used to post the accounts receivable and general ledgers.
The bank transaction journal entries below act as a quick reference, and set out the most commonly encountered situations when dealing with the double entry posting of banking transactions. In each case the journal entries show the debit and credit account together with a brief narrative.
When a business undertakes import trade with overseas suppliers and makes payment in a foreign currency it needs to try and protect itself from fluctuations in the currency exchange rate. One method of achieving this is to buy the foreign currency using a currency forward contract.