Ch02 — Journal to trial balance

Running case (Jan 2026): a “real” first month

Harborview Bike Repair has moved past the first-day setup. In this chapter you record a fuller set of January transactions that make a trial balance feel like something you’d see in an actual small business:

  • cash + invoice (A/R) revenue

  • supplies kept on hand (an asset, later expensed)

  • equipment purchased on account (A/P)

  • routine operating costs (rent)

If you ever feel lost, read each entry_id as a short business sentence:

  • T001: owner funds the business with cash

  • T002: buy supplies with cash

  • T003: buy equipment on account (creates Accounts Payable)

  • T004: cash service revenue

  • T005: service revenue on account (creates Accounts Receivable)

  • T006: pay rent

  • T007: pay down Accounts Payable

  • T008: collect part of Accounts Receivable

What you’ll learn

  • Write balanced journal entries in transactions.csv

  • Explain what LedgerLoom’s entries.csv represents

  • Explain what a trial balance is (and what it isn’t)

  • Reconcile your spreadsheet totals to trial_balance_unadjusted.csv

Key accounting terms

  • Journal entry: a set of lines with the same entry_id. Balanced entries are the first invariant.

  • Debit / credit: a direction on an account, not a value judgement. A quick normal-balance cheat sheet:

    • Increase with debits: Assets, Expenses, Dividends

    • Increase with credits: Liabilities, Equity, Revenue

  • Posting: taking journal lines and “posting” them into the ledger (grouped by account).

  • Ledger: the running history of each account after posting.

  • Trial balance (unadjusted): balances after regular transactions before end-of-period adjustments. A trial balance can balance and still be wrong (wrong account or wrong period), so you still need reasoning.

What to do in your spreadsheet

  1. Enter the chapter’s transactions as journal lines.

  2. Ensure each entry_id is balanced (total debits = total credits).

  3. Produce your spreadsheet trial balance.

Export CSVs

Export:

  • inputs/<period>/transactions.csv

(Adjustments come in Chapter 3, so adjustments.csv can be empty for now.)

Run LedgerLoom

ledgerloom check --project .
ledgerloom build --project . --run-id ch02

What to look at

  • entries.csv: normalized entries (LedgerLoom’s parse of your journal)

  • trial_balance_unadjusted.csv: your transactions-only trial balance

For definitions and “how to read it”, see Workbook Artifacts Reference.

Compare against the answer key

If you want to confirm your work:

Common mistakes

  • Entry not balanced (LedgerLoom will flag this)

  • Using an account that isn’t in your chart of accounts

  • Sign errors (debit/credit swapped)

  • Spreadsheet TB includes an account total that doesn’t tie to your journal lines

Downloads

Next chapter

Continue to Ch03 — Adjusting entries.