Introduction:- The word ‘Journal means’ a daily record. Journal is derived from French word ‘Jour’ which means a day. It is a book of original or prime entry written up from the various sources documents. Every transaction is recorded in the first instance and than it is posted to the ledger. The form in which it is recorded is called journal entry and recording or entering a transaction in the journal is known as Journalizing.

Rules of Journalizing:- The process of passing an entry in a journal is called Journalizing. The rule for Journalizing is same as that of rules of debit and credit. It is based on two facts. First is accounting equation and other is accounting approach.

1.) Based on Accounting Equation:-

a)      Increases in assets are debits, decreases are credit.

b)     Increased in liability are credit, decreases are debits.

c)      Increases in capital are credits, decreases are debits.

d)     Increases in profits are credits, decreases are debits.

e)  Increases in expenses are debits, decreases are credits.

2.) Based on Traditional Approach:-

a)      Debit the receiver, credit the giver

b)     Debit what comes in, credit what goes out.

Debit all expenses and losses, credit all income and gains.