What Are The Advantages Of Using Special Journals

In a more complex system, there are more repetitive transactions according to type like sales, purchases, cash and others hence the need to provide a separate special journal for each type. Entries not of a repetitive nature like corrections, adjusting entries and closing entries are entered into the general journal.

Examples of Special Journals are sales journal, purchases journal, cash receipt journal and cash disbursement journals.

So what are the advantages of using the Special Journals?

They are as follows:

• Reduces detailed recording. Using the special journal concept, individual posting is eliminated. Only one posting for the total amount is made to the appropriate ledger account at the end of the accounting month. For example, if a company had 500 purchases on account during the month, the purchases account would only be debited one, not 500 times

• Permits better division of labor. Each special journal can be handled by a different person allowing specialization and making the work more efficient.

• Permits better internal control. Allocation of work of special journal to individual person ensure that no one person has conflicting responsibilities like the receipt and recording of cash which ensure better internal control.