What is the purpose of the general journal and how does it relate to the ledger?

• A. The general journal records transactions with debits and credits; postings move these amounts to the respective general ledger accounts to accumulate balances.
• B. The general journal is a summary of all cash receipts and disbursements.
• C. The general ledger records transactions with debits and credits; postings move these amounts to the respective general journal accounts to balance the books.
• D. The trial balance lists only ledger balances.

Answer: (A)

The general journal is where each transaction is first recorded in a chronological, double-entry format, showing the accounts affected and the corresponding debits and credits. This keeps a complete, auditable trail of every event. After recording in the journal, the amounts are posted to the general ledger—moving each debit or credit to the appropriate ledger accounts—to accumulate running balances by account. This connection is what lets you go from individual journal entries to the summarized ledger balances used to prepare financial statements. The other descriptions mix up different journals or purposes (cash receipts/disbursements are tracked in separate cash journals; the ledger stores balances, not the initial sequence of entries; and the trial balance lists ledger balances rather than the journal’s function).