Journal entry format is the way journal entries are organized and appear in the general journal. After a business transaction has occurred, the bookkeeper analyzes the transaction and identifies what accounts have been affected. Then a journal entry is made.
Journal entry format usually consists of four columns: one column for the date of the transaction, another for the account names, and columns for the debits and credits. Here’s an example of a typical journal entry format.
As you can see the date is always listed on the far left side of the journal entry. Since journal entries are made throughout the year, it is important to properly date each one.
The account names are the second column from the left. These names are simply the account name in the chart of accounts. So if cash was affected by the transaction, the cash account would be listed in the account name column.
The debit and credit columns are always the two far right columns. The debit column is always on the left of the credit column. This is because a debit entry is a left-sided entry and a credit entry is a right-sided entry.
At the bottom of every journal entry, there should be a short description of the business transaction that the journal entry is recording. For example, if a business bought a car the journal entry description might read, “To record the purchase of a vehicle”. The journal entry description is important, so businesses can reference the journal entries and remember what transaction created the entries.
Journal Entry Format Example
Notice that the debited account is always listed first in a journal entry. Credit accounts are always listed last and indented. This is easy to remember because a credit is always on the right side, so a credit account has to be indented to the right. If multiple debit or credit accounts are listed in one journal entry, the journal entry format would stay the same: debit accounts are listed first and credit accounts are listed last.