Journal Entries, Depreciation, Accruals & Month-End Closing

Learning Objectives

By the end of this guide, you will:

1. Understand the Transaction Document State Machine (Draft, Submitted, Cancelled, Deleted).
2. Create and post multi-row Journal Entries with zero mathematical difference.
3. Calculate and record Fixed Asset Depreciation.
4. Book Accruals (Salaries, Rent Payable) and Prepaid Expense Amortization.
5. Record Owner Equity Infusions & Drawings.
6. Audit the live General Ledger impact directly from any transaction document.

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The Transaction Document State Machine

Every transactional document in Roznamcha Digital (Invoices, Payments, Journals, Stock Movements) follows a strict audit state flow:

Document Status Visual States:

Auditing the General Ledger from Documents:

From any submitted document, click View > General Ledger to audit the exact debits and credits posted:

Cancellation & Reversals:

If a submitted entry was created in error, click Cancel:

If an unsubmitted draft is no longer needed, click Delete:

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Creating a Multi-Account Journal Entry

Navigate to Accounting > Journal Entries > New Journal Entry:

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Common Month-End Adjustments

1. Fixed Asset Depreciation (Straight-Line Method)

• Formula: Monthly Depreciation = (Asset Cost - Salvage Value) / (Useful Life in Months)
• Journal Posting:
  • Debit: 5210 Depreciation Expense (Expense increases)
  • Credit: 1211 Accumulated Depreciation (Contra-asset increases)

2. Salary & Payroll Accruals

At the end of the month, even if cash is paid out on the 5th of the following month, the expense belongs in the active month:

• Journal Posting:
  • Debit: 5130 Salaries & Wages Expense (Expense booked in current month)
  • Credit: 2130 Salaries Payable (Liability until paid out)

3. Owner Drawings & Capital Infusions

When the business owner deposits personal funds or withdraws profit for personal living expenses:

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Common Pitfalls & Best Practices

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Knowledge Check