Week 4
 Contains a chronological list of transactions all in
one place.
 Does not tell business owner what the account
balances...
 Book of final entry; accumulates all entries to
arrive at a final balance for all accounts
 Process of transfer from jo...
 Account title and account number
 Date of transaction from journal
 Post Ref is page of journal
 Debit/Credit of tran...
 Record date and amount of transaction from the
journal (debit or credit)
 Record posting reference (journal page)
 Cal...
 List of individual accounts and their debit or credit
balance as taken from ledger.
 Listed in same order as found in l...
 What to check.
◦ Omitted transaction.
◦ Transaction entered incorrectly in journal.
◦ Journal entry posted incorrectly i...
 Amount of difference is 10 or 100 or 1,000 check your
addition.
 Difference equal to an account balance check if
amount...
 Is difference evenly divisible by 9? If so may be a
slide or transposition error.
◦ $2,150.00 copied as $21.50
◦ $2, 150...
 Business tracks transaction for a specified period
of time known as the accounting period or the
fiscal period.
 At end...
Questions?
Week 4
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Week 4

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Week 4

  1. 1. Week 4
  2. 2.  Contains a chronological list of transactions all in one place.  Does not tell business owner what the account balances are for each account.
  3. 3.  Book of final entry; accumulates all entries to arrive at a final balance for all accounts  Process of transfer from journal to ledger is known as posting.
  4. 4.  Account title and account number  Date of transaction from journal  Post Ref is page of journal  Debit/Credit of transaction from journal  Balance calculated from debit/credit posted
  5. 5.  Record date and amount of transaction from the journal (debit or credit)  Record posting reference (journal page)  Calculate new account balance by extending debit or credit to right (think normal balance)  Record account number in Post Ref column of the journal page.
  6. 6.  List of individual accounts and their debit or credit balance as taken from ledger.  Listed in same order as found in ledger.  All accounts are listed, even accounts with a zero balance.  Total debit and credit columns to see if debits equal credits.  What if trial balance doesn’t balance?
  7. 7.  What to check. ◦ Omitted transaction. ◦ Transaction entered incorrectly in journal. ◦ Journal entry posted incorrectly in ledger. ◦ A debit balance placed in credit column or a credit balance placed in debit column of trial balance.
  8. 8.  Amount of difference is 10 or 100 or 1,000 check your addition.  Difference equal to an account balance check if amount was omitted or not posted.  Divide difference by 2 and check for that amount in the higher column total. Check to see if a debit of that amount should have been a credit and vice versa.  Compare balance in trial balance to balances in ledger to check for copying errors.
  9. 9.  Is difference evenly divisible by 9? If so may be a slide or transposition error. ◦ $2,150.00 copied as $21.50 ◦ $2, 150 copied as $2,510  Recalculate balances in ledger accounts.  Trace journal to ledger postings.
  10. 10.  Business tracks transaction for a specified period of time known as the accounting period or the fiscal period.  At end of fiscal period the business needs to prove the equality of debits and credits.  Do the totals of all debit account balances equal total of all credit account balances?  This is done by preparing a trial balance.  Must prepare trial balance before reporting financial information in financial statements.
  11. 11. Questions?

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