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Chapter 1. Working with Income Statement... > Moving from the General Journal to t...

Moving from the General Journal to the Income Statement

It is typical for a business to record its daily transactions in a General Journal. This record keeps track of every individual transaction in every account, whether cash investments, cash paid, accounts receivable, accounts payable, and so on.

Getting the General Journal into Excel

There are many different software programs available to help you record and store this information. Because some programs provide the user with such conveniences as a predefined chart of accounts, many people prefer to use software other than Excel to gather information on individual transactions. (A chart of accounts is simply a list that associates account names with numbers that identify the account: for example, you might decide to identify Accounts Payable with the number 20.) Excel is, of course, a sensible choice of platform for entering, storing, and retrieving information about individual transactions (although for these purposes Excel is much less powerful and flexible than a true database such as Oracle or, on a much smaller scale, Microsoft Access). If you choose Excel for this purpose, you will have to build many features from scratch, including your own categories for transactions, the double-entry nature of recording individual transactions, and so on.


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