Journal Entries – are similar to T-accounts in that they can represent several general ledger accounts, each of which is either a debit or a credit. The total of the debits must equal the total of the credits, or the journal entry is said to be “unbalanced.” Journal entries directly change the account balances on the general ledger.
Debits are reported first, as common practice, followed by credits which are slightly (right) indented, e.g.
Date Account Titles and Explanation Posted Ref. Debit Credit
Jan. 1 Cash 20.00
Contributed Capital 20.00