A journal entry is a way to record the financial activity of your law firm. Every time money moves—whether it's coming in or going out—you can use a journal entry to track that activity in your accounting system. Journal entries help keep your books organized and ensure your financial records are accurate.
Journal entries use a method called double-entry bookkeeping, which means each transaction is recorded in two places:
One side shows where the money is going (debit),
The other side shows where it came from (credit).
These two sides must always balance. For example, If you add $100 to one account, you must take $100 from another account.
Click here for more information on when creating a journal entry may be required.
To create a journal entry follow the steps below:
From the white New button, choose Journal Entry from the menu, or navigate to Accounting > Journal Entries and click Create Journal Entry.
Enter the date of the transaction.
Use the actual date the money moved.
Record the Debit Entry.
Select the debit account from your list of accounts.
Add a description - write a note to explain the reason for this journal entry.
Enter the amount - this is the amount being added to the account.
Record the Credit Entry.
Select the credit account from your list of accounts.
Add a description - write a note to explain the reason for this journal entry.
Enter the amount - this is the amount being removed from the account.
Ensure the total debits equal the total credits.
If they do not match, an error message will appear, and the entry cannot be saved.
Click Record Journal Entry to complete the journal entry.
What Happens Next?
If the journal entry doesn’t balance, double-check that the debit and credit amounts are correct and that you selected the right accounts. If you're unsure which accounts to use, consult your accountant or bookkeeper. Once saved, the journal entry is listed in the account ledger and can be reviewed or edited as needed.