Fastest Way to Pass the Journal Entries - 3 Journal Entries Strategies - How to Pass the Journal Entries

Do you have the confusion to pass the journal entries. Do you do more mistakes. in passing journal entries. Today, we are giving you 3 best strategies which help you remove your confusion, mistakes and you will enable fast journal entries. We have taken it from Journal Entries eBook.

Recently, we have studied book Journal Entries MADE Easy. In this ebook, he told the revolutionary method to pass the journal entries fastest way which can help everyone who are facing the problem in passing the journal entry. 

If any student follow these 3 strategies good way, then he can minimize the mistake in passing journal entries and make the better base of accounting. 

1st Strategy : Read Transaction Carefully 2 to 4 times

It is very simple but very effective rule. When you read one time transaction, you may mistake to understand the transaction. Even you know the rules but because you have understood wrong, you will make the wrong journal entry and you are also doing efforts to make wrong financial statement. 

Is not better to give small more efforts in beginning by reading it two or more times. 

Like if  you cut the cloth, it will cut, before cutting measure its size two times. This is perfect rule. 

2nd Strategy :  Which Accounts are Affected with Transaction

You have to find all accounts which will affected. For example 

Beginning of the month, I paid my employees rent on his behalf and deducted from his salary at the end of month. 

In this, we can make the list which account will affect with this transaction

our bank account 

rent account 

our employee account 

salary account

Like this, you can also make the list of account which affected 

3rd Strategy : Apply Journal Entries Rule and Once Pass the Journal Entries 

Simple journal entries rules are 

If in your business, assets increases, it will be debited

If in your business, liabilities decrease, it will debited

If in your business, liabilities increases, it will be credited

If in your business, assets decrease, it will credited

Now, come on above transaction

Beginning of the month, I paid my employees rent on his behalf and deducted from his salary at the end of month. 

In this, we can make the list which account will affect with this transaction

our bank account 

rent account 

our employee account 

salary account

Apply the rules

when we pay from business, our bank balance asset has decreased it means, bank account must be credited in the beginning of month. Because we paid on the behalf of our employee, actual liability is of our employee. It means, we have to take same rent money at the end of month, so, asset in the form of our employees account will debit because we can claim same amount on our employee.

So, pass the journal entry at the beginning of month

our employee account debit

bank account credit

at the end of month, we have deducted same amount from salary. So, our bank asset has increased and our asset in the form of receivable amount from employee has decreased because we have received by deducting same amount. So, our employee account will credit.

Bank account debit 

Our employee account credit

Please download Journal Entries eBook.