i. Narration is not required for each and every entry. ii. A journal voucher is a must for all transactions recorded in the Journal.

Question

State whether the following statements are True or False with reason:

i. Narration is not required for each and every entry.

ii. A journal voucher is a must for all transactions recorded in the Journal.

Answer 1

i. This statement is False.

Correct statement: Narration is required for each and every entry. Reasons: Narration is a brief explanation of the Journal Entry. It is written in the bracket just below the accounting entry. By reading the narration, the reader understands the meaning and significance of accounting entry and the nature and type of business transactions. Narration should be as short as possible and it should be simple and easy to understand.

ii. This statement is True.

Reasons: A voucher is a document that supports a payment made by the businessmen. It is legal evidence that a certain sum of money has been paid to a specific person or party. A Journal voucher is an original or basic voucher on the basis of which business transactions are journalized in the journal. Journal voucher provides legal proof for the business transactions. Therefore a journal voucher is necessary for all transactions recorded in the journal.