Visit to a Proprietary Concern and Preparation of Journal

During a visit to a proprietary concern, it is important to observe and understand the business operations in order to prepare a journal. The journal is a chronological record of all the financial transactions of the business. Here is a step-by-step guide on how to prepare a journal based on an 8-day visit to a proprietary concern.

Step 1: Introduction
Begin by introducing the proprietary concern you visited. Provide a brief overview of the nature of the business, its products or services, and any other relevant information.

Step 2: Observations
During your visit, make note of all the financial transactions that occur. This may include sales, purchases, expenses, and any other monetary activities. It is important to observe and understand the processes and systems in place to accurately record these transactions.

Step 3: Recording Transactions
Once you have observed the financial transactions, record them in the journal. The journal typically consists of columns for date, description of the transaction, and the respective debit and credit amounts. Ensure that you record each transaction in the correct chronological order.

Step 4: Classifying Transactions
After recording the transactions, classify them into appropriate accounts. This helps in organizing and summarizing the financial information. Common accounts include cash, accounts receivable, accounts payable, inventory, and expenses.

Step 5: Posting to Ledger
Once the transactions are recorded in the journal, they need to be posted to the respective ledger accounts. This involves transferring the debit and credit amounts from the journal to the corresponding accounts in the ledger.

Step 6: Balancing the Ledger
After posting the transactions to the ledger, calculate the balances of each account. This is done by adding the debit and credit amounts and determining the difference. The balances should be equal on both sides, indicating that the accounts are in balance.

Step 7: Trial Balance
Prepare a trial balance by listing all the ledger accounts and their respective debit and credit balances. This helps in verifying the accuracy of the recorded transactions and ensures that the books are in balance.

Step 8: Financial Statements
Based on the information recorded in the journal, ledger, and trial balance, prepare financial statements such as the income statement and balance sheet. These statements provide a summary of the financial performance and position of the proprietary concern.

In conclusion, a visit to a proprietary concern provides valuable insights into the financial transactions of the business. By observing and recording these transactions in a journal, one can accurately document the financial activities and prepare essential financial statements.