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Why cant you do anything with a journal entry?


#1

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.


#2

Cash accounts has not been removed. You just need to add it as an option in customize.

99.9% of the transactions that you want to do can be done without using journal entries. The point of Journal entries is to do transactions that cannot be done by the program through another means. It is better to only use Journal transactions as a last resort because the point of Manager is to make it easy for you to do your accounts without having to use Journal entries and possibly making a mistake in the journal entry as you need to know what to debit and what to credit.

In your example, you would have a cash account and you do a spend money transaction on the cash account to an expense account called shrinkage. You can create an expense account in chart of accounts with that name. I am not sure if that would fall under expenses or equity, but my point is, you don’t need journal entries for virtually all transactions in Manager. I am not sure why Journal entries would be restricted for anything as I have never needed to use it - in the 3 months that I have been using the program.


#3

Hi, I’m also facing the same problem that in journal entries Cash and Bank accounts are not showing.
I want to update my record my journal entries from day first to pass Journal entry of
Dr.Cash xxxx
Cr.Capital xxxx


#4

@dalacor did not make it clear that the ability to make journal entries involving cash and bank accounts was removed some months ago. Any transaction you made previous will now appear under your cash or bank account tabs. You can still do all the same things, but you now do them from the bank/cash accounts rather than as a journal entry. The net result is far more options.

For the transaction you mention, open the Bank Accounts or Cash Accounts tab, depending on where you are putting the money. Click on Receive Money. Enter your capital account and the amount. Click create. Quicker and easier than a journal entry, because you don’t have to remember which account to debit and which to credit. Manager does it for you.