Difference between Journal and Ledger is that the journal is the first step of bookkeeping and ledger is followed by the journal. Because the bookkeeping involved the predefined/Standard process of recording all the business transactions in the books of account. This process is known as the accounting cycle. Accounting cycle starts from the journal and followed by ledger, trial balance and final accounts.
Journal in Accounting is the process of analyzing and recording of business transactions in chronological (day to day) order. This book is also called the Book of Prime or Original Entry book. The journal entries are the foundation of the accounting system and it is also a first step of the accounting cycle.
It is a book of account in which we kept all the transactions of a particular account separately. With the help of ledger, we get whole information about a particular account at a single place. but in the journal, all the transactions are recording date wise but if we want the total balance of a particular account then it is very difficult to get it.
|Basis of Difference||Journal||Ledger|
|Meaning||Journal in Accounting is the process of analyzing and recording of business transactions in chronological (day to day) order.||Ledger is a book of account in which we kept all the transactions of a particular account separately.|
|Type||it is the subsidiary book||It is the final book of account.|
|Order of Recording||In the journal, all transactions are recorded in chronological (day to day) order.||In the Ledger, the transactions related to a single account(Cash, Bank etc.) are recorded in chronological (day to day) order in a particular ledger account.|
|Name of Process||Journalizing||Posting from journal to ledger.|
|Format||In the format of the journal, debit and credit are two different columns.||In the format of the Ledger, debit and credit are two different sides of an account.|
|Nature of Account||All transactions are recorded in the same book called a journal.||All transactions are posted in the particular ledger account according to the nature of an account.|
|Balance||It is very difficult to know the balance of a particular account.||The ledger is prepared to know the balance of a particular account.|
|Narrations||Journal contains a narration for every transaction||Ledger may or may not contain a narration of every transaction.|
|Also known as||The book of prime or original entry book||The book of second entry and statement of account.|
|Process of Balancing||It does not include the process of balancing.||It includes the process of balancing or closing of a ledger account.|
|Financial Statement||We can not prepare financial statement directly from the journal||We can prepare financial statement directly from the ledger but not so easy for larger businesses.|
|Revenue||The Journal not providing any information about the total revenue earned during the year.||In the ledger, we can get know about the revenue earned during the year from the total Sales accounts.|
|Closing Balances of the Assets||It is very difficult to know the closing balance of the assets at the end of a particular accounting period.||It is very easy to know the closing balance of the assets at the end of a particular accounting period.|
|Folio||Journal contains a ledger folio column.||The ledger contains a journal folio column.|
|Total Columns||Journal contains a total of five columns||The ledger contains a total of eight columns.|
|Sides||It does not have any side.||It has two sides i.e. debit and credit side.|
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Journal is the original entry book and we record all day to day transactions in the journal first then after we post these all transactions in the related ledger accounts. Both are the step of the accounting cycle.
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