All journal entry exercises
Build each entry by placing accounts in the Debit and Credit columns, then check it. Choose the convention you were taught: US textbooks, the Spanish PGC, the French PCG or generic German accounts. Every exercise draws new amounts as often as you like.
The entries
Starting the business
- Owner invests cash to start the business
- Owner contributes a machine to start the business
- Owner invests cash and a delivery van
- Receiving a bank loan
- Repaying the principal of a bank loan
- Paying a loan installment: principal plus interest
- Owner withdraws cash for personal use
- Owner takes goods from stock for personal use
- Owner pays a business expense personally
- Issuing common stock at par for cash
Buying goods and supplies
- Buying merchandise for cash
- Buying two lines of merchandise on account
- Buying merchandise, paying part in cash and the rest on account
- Paying a supplier’s invoice in full
- Returning part of a purchase on account
- Paying a supplier within the discount period
- Paying freight on purchased merchandise
- Buying office supplies for cash
- Buying office supplies on account
- Buying merchandise with a trade discount
- Buying merchandise on account
- Returning merchandise bought on account
- Buying merchandise with a cash discount on the invoice
- Buying merchandise under the periodic inventory system
- Paying part of a supplier’s invoice by bank transfer
Selling goods and services
- Cash sale of merchandise (periodic inventory)
- Sale on account with a trade discount
- Cash sale with cost of goods sold (perpetual inventory)Not in: Spain (PGC 2007), France (PCG 2025)
- Sale on account with cost of goods soldNot in: Spain (PGC 2007), France (PCG 2025)
- Customer returns merchandise bought on account (periodic inventory)
- Customer returns goods for a cash refund, restocked (perpetual inventory)Not in: Spain (PGC 2007), France (PCG 2025)
- Collecting a customer’s invoice in full, in cash
- Customer pays within the discount period
- Selling merchandise on account with sales tax
- Cash sales with sales tax included in the total
- Invoicing a client for services rendered
- Service paid for on completion
- Receiving a customer deposit before the service
- Delivering a service the customer paid in advance
- Sale paid partly in cash, partly on account
- Writing off a bad debt: direct write-off method
- Writing off an account under the allowance method
- Estimating bad debts as a percentage of sales
- Recovering an account previously written off
- Receiving rent for a van rented out
Fixed assets
- Buying equipment for cash
- Buying a computer server on account
- Buying equipment with a down payment and a note payable
- Buying equipment including freight and installation
- Buying equipment with sales tax, part paid and part on account
- Buying a plot of land
- Buying a building with a mortgage loan and a bank transfer
- Buying a delivery van with a bank loan
- Annual straight-line depreciation of a delivery van
- Depreciation of a building for part of its first year
- Declining-balance depreciation, first year
- Depreciating several assets in one entry
- Selling a machine on account at a gain
- Selling a machine at a loss
- Scrapping a fully depreciated machine
- Trading in an old delivery van for a new one
- Paying for an ordinary repair
- Adding a refrigeration unit to a van, on account
- Owner contributes a private machine to the business during the year
- Selling a machine at a gain, with VATNot in: United States (US textbooks)
Expenses and payroll
- Paying the monthly rent
- Paying six months’ rent in advance
- Expensing one month of prepaid rent
- Receiving the electric bill
- Paying the electric bill
- Paying the month’s salaries
- Accruing unpaid salaries at year end
- Paying salaries accrued at year end
- Monthly payroll with withholding and employer payroll taxes
- Recording the employer’s payroll taxes
- Paying for advertising
- Paying an annual insurance premium in advance
- Expensing one month of prepaid insurance
- Recording office supplies usedNot in: Spain (PGC 2007), France (PCG 2025), Germany (generic accounts)
- Bank charges on a wire transfer to a supplier
- Paying quarterly interest on a bank loan
- Accruing interest on a bank loan at year end
- Receiving a telephone bill to pay later
- Reimbursing the owner for a business trip
- Paying income tax owed by a corporation
Adjusting, closing and correcting
- Accruing revenue earned but not yet invoiced
- Accruing electricity not yet invoiced at year end
- Recognizing unearned revenue at year end
- Adjusting prepaid insurance at year end
- Year-end straight-line depreciation
- Adjusting office supplies to the year-end countNot in: Germany (generic accounts)
- Adjusting the allowance for doubtful receivables to its required balance
- Accruing interest on a customer’s note at year end
- Recording inventory shrinkage at year endNot in: Spain (PGC 2007), France (PCG 2025)
- Closing the revenue accounts to Income Summary
- Closing the expense accounts to Income Summary
- Closing net income to Owner’s Capital
- Closing a net loss to Owner’s Capital
- Closing Owner’s Drawings to Owner’s Capital
- Reversing an accrued bonus at the start of the year
- Correcting a customer payment posted to the wrong account
- Correcting an insurance payment recorded at the wrong amount
- Settling VAT for the periodNot in: United States (US textbooks)
- Recording the income tax for the year
- Closing revenues and expenses directly to Retained Earnings
Cash and bank
- Depositing the cash takings in the bankNot in: United States (US textbooks)
- Withdrawing cash from the bank, with a feeNot in: United States (US textbooks)
- Setting up a petty cash fund
- Replenishing petty cash after several small expenses
- Customer check returned NSF
- Bank collects a note receivable for the company
- Bank fee and interest found in a bank reconciliation
- Cash shortage found at the cash count
- Transferring money between two of the company’s bank accountsNot in: United States (US textbooks)
- Customer pays two invoices by one bank transfer, less a bank fee
Notes and loans
- Accepting a customer’s note for an open account
- Collecting a note with interest
- Giving a supplier a note for an open account
- Paying a note with interest at maturity
- A customer dishonors a note
- Receiving a bank loan net of an arrangement fee
- Paying a loan installment: splitting interest and principal
- Accruing interest on a note payable at year end
- Lending cash to an employee
- Repaying a bank overdraft
Inventory and cost of goods
- Recording the month’s cost of goods sold in one entryNot in: Spain (PGC 2007), France (PCG 2025)
- Period-end cost of goods sold under the periodic system
- Writing inventory down to net realizable value
- Using goods from stock as office suppliesNot in: Spain (PGC 2007)
- Paying freight-out on goods sold
- Returning damaged goods for a cash refund
- Purchase discount taken, reducing inventoryNot in: Spain (PGC 2007), France (PCG 2025)
- Recording an inventory count surplusNot in: Spain (PGC 2007), France (PCG 2025)
- Donating goods to a charityNot in: Spain (PGC 2007)
- Transferring unsold purchases to inventory at year endNot in: United States (US textbooks)
Corporations and equity
- Issuing common stock above par
- Declaring a cash dividend
- Paying a declared dividend
- Buying treasury stock
- Declaring and paying a dividend the same day
- Allocating profit to the legal reserveNot in: United States (US textbooks)
- Converting a loan into shares
- Closing a corporation’s net income to Retained Earnings
- Closing a corporation’s net loss to Retained Earnings
- Issuing common stock in exchange for land
Multi-step scenarios
How checking works
- The checker adds up your lines per account: debits count as plus, credits as minus. Splitting an account over several lines, or the order of the lines, never matters.
- Your entry is correct when every account ends with exactly the amount of an accepted answer. Where an item accepts two presentations, both are shown with the answer.
- If it is not correct, you see only what follows from comparing the two entries: an unbalanced total, a missing account, an account that does not belong, a wrong side or a wrong amount.
- Each item states its assumptions. If a correct entry is marked wrong, please report it with the reference shown under the item.
- Type amounts the way you write them, for example 1,234.56; a currency sign is ignored.