This diagram shows the progression from source documents to final accounts in a manual accounting system. There are 7 journals:

Sales Journal - all invoices issued are entered in the Sales Journal

Sales Returns Journal - all credit notes are issued in the Sales Returns Journal

Cash Receipts Journal - Cash dockets, receipts, cheques received and direct credits are entered in the Cash Receipts Journal


General Journal - Contracts, memos are entered in the General Journal. Any transactions which do not involve Sale of Goods or Purchase of Goods are entered in the General Journal. For example Owner Equity additions or purchase of equipment or Owner Drawings.

Purchases Journal - all invoices received are entered in the Purchases Journal.

Purchase Returns Journal - all credit notes received are entered in the Purchases Returns Journal.

Cash Payments Journal - Receipts received, cheques issued and direct debits are entered in the Cash Payments Journal.

These entries are then transferred to 3 Ledgers: Receivables, Payables & General Ledger.