Journal Entries: Basic Definitions

     A record of increases and decreases in specific asset, liability, or owner's equity items.

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The left side of an account (Dr).

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     The right side of an account (Cr).

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An account balance on the side where an increase in the account is recorded.

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     An accounting record in which transactions are initially recorded in chronological order (day-by-day).

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     A system that records in appropriate accounts the dual effect of each transaction. The Equality of Debits and Credits; each financial transaction has Debit and Credit party. Debit must be equal to Credit.

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A journal entry that involves only two accounts.

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     A journal entry that involves three or more accounts.

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     The entire group of accounts maintained by a company.

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     provides the balance in each of the accounts as well as keeps track of changes in these balances.

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