I am new to accounting so it could be a dumb question, apologies in advance.
An accountant said to me… You can do anything with a journal entry, but that doesnt seem the case?
I saw in another post that Cash accounts was removed and I was wondering why, the philosophy behind that would be enlightening.
So an example, I’m learning, so I make stuff up.
I have a Petty Cash account, and 500 dollars is stolen out of the Till…
So I think… well I just make a loss account.
Make Journal Entry from Petty Cash to Loss acc
Then From Loss to Owners Equity
But its not possible, so I’m wondering how, but more so, I’m wondering why there seems to be these restrictions on the journal? Probably a missing concept in my feeble knowledge of accounting.