The document summarizes journal and ledger posting concepts and procedures. It provides examples of journal entries for capital contributions by partners and transactions involving cash, purchases, sales, and other accounts. It then explains the key aspects of ledger accounts including their format and the posting process to transfer journal entries to respective accounts in the ledger. Procedures for compound journal entries and advantages of the ledger are also outlined.

1. Journal and ledger posting

2. Some unusual transactions and
their journal entries

3. June 1, 2004 – Anju contributed capital Rs.
50,000
Manju contributed capital Rs.
70,000
50000
70000
Anju Manju
Capital

4. 17. June 1, 2004 – Anju contributed capital Rs. 50,000
Manju contributed capital Rs. 70,000
Journal

5. Jualy 1, 2004 – Ajay contributed capital – Cash Rs.
90,000, Furniture Rs. 20,000
Vijay contributed capital – Cash Rs. 50,000
Stock Rs. 70,000
Ajay
cash
Furniture
Vijay

6. Journal
July 1, 2004 – Ajay contributed capital – Cash Rs. 90,000, Furniture Rs. 20,000
Vijay contributed capital – Cash Rs. 50,000, Stock Rs. 70,000

7. July 13, 2003 – Received cash Rs.24,700 from
Shanthi in full settlement of her account of
Rs.25,000.

8. July 13, 2003 – Received cash Rs.24,700 from Shanthi in full settlement of her
account of Rs.25,000.

9. 20. July 14, 2003 – Paid cash to Thenmozhi s.14,500, in full settlement
of her account of Rs.15,000.

10. 21. Jamuna who owed us Rs.10,000 is declared insolvent and
25% in a rupee is received from her on 15th July, 2003.
Insolvent:
Unable to meet debts or
discharge liabilities

11. What is bad debts?
The term bad debts usually refers to accounts receivable (or
trade accounts receivable) that will not be collected. However,
bad debts can also refer to notes receivable that will not be
collected.
The bad debts associated with accounts receivable is reported
on the income statement as Bad Debts Expense or Uncollectible
Accounts Expense.

12. Journal
21. Jamuna who owed us Rs.10,000 is declared insolvent and
25% in a rupee is received from her on 15th July, 2003.

13. Received cash for a Bad debt written off last year
Rs.7,500 on 18th January, 2004.
Insolvent Solvent

14. Journal
Received cash for a Bad debt written off last year
Rs.7,500 on 18th January, 2004.

15. Ledger posting

16. • A Ledger is a book which contains all the accounts which
are first entered in journal.
• According to L.C. Cropper, ‘the book which contains a
classified and permanent record of all the transactions of
a business is called the Ledger’.
• It’s a permanent record of transactions that can not
changed.
Ledger

17. Name of The Account
Dr. Cr.
Format of Ledger
Date Particulars JF Amount
AED
Date Particulars JF Amount
AED
Year
Month
Date
Accounts name Year
Month
Date
Accounts
name

18. • i. Each ledger account is divided into two parts. The left hand side is known as the debit side
and the right hand side is known as the credit side. The words ‘Dr.’ and ‘Cr.’ are used to
denote Debit and Credit.
• ii. The name of the account is mentioned in the top (middle) of the account.
• iii. The date of the transaction is recorded in the date column.
• iv. The word ‘To’ is used before the accounts which appear on the debit side of an account in
the particulars column. Similarly, the word ‘By’ is used before the accounts which appear on
the credit side of an account in the particulars column.
• v. The name of the other account which is affected by the transaction is written either in the
debit side or credit side in the particulars column.
• vi. The page number of the Journal or Subsidiary Book from where that particular entry is
transferred, is entered in the Journal Folio (J.F) column.
• vii. The amount pertaining to this account is entered in the amount column.
Explanation:

19. The process of transferring the
entries recorded in the journal or subsidiary
books to the respective accounts opened in
the ledger is called Posting.
Posting

20. I. Procedure of posting for an Account which has been debited in the journal entry.
Step 1 →Locate in the ledger, the account to be debited and enter the date of the
transaction in the date column on the debit side.
Step 2 →Record the name of the account credited in the Journal in the particulars
column on the debit side as “To..... (name of the account credited)”.
Step 3 →Record the page number of the Journal in the J.F column on the debit side and
in the Journal, write the page number of the ledger on which a particular account
appears in the L.F. column.
Step 4 →Enter the relevant amount in the amount column on the debit side.
Procedure of posting

21. II. Procedure of posting for an Account which has been credited in the journal entry.
Step 1 →Locate in the ledger the account to be credited and enter the date of the
transaction in the date column on the credit side.
Step 2 → Record the name of the account debited in the Journal in the particulars column
on the credit side as “By...... (name of the account debited)”
Step 3 → Record the page number of the Journal in the J.F column on the credit side and
in the Journal, write the page number of the ledger on which a particular account
appears in the L.F. column.
Step 4 → Enter the relevant amount in the amount column on the credit side.
Procedure of posting

22. Example of Ledger and Posting

23. Journal
Mr. Ram started business with cash
Rs.5,00,000 on 1st June 2003.
Write the journal of this
transaction

24. Journal
Mr. Ram started business with cash
Rs.5,00,000 on 1st June 2003.

25. Try to find how many accounts
involved in the journal
Cash Account
Ram,s Capital
Account

26. For ledger posting draw 2 Ledgers
Cash Account
Ram,s Capital
Account

27. Name of Account
Dr. Cr.
Date Particulars JF Amount
AED
Date Particulars JF Amount
AED
Year
Month
Date
Accounts name Year
Month
Date
Accounts
name
Name of Account
Dr. Cr.
Date Particulars JF Amount
AED
Date Particulars JF Amount
AED
Year
Month
Date
Accounts name Year
Month
Date
Accounts
name

28. Write the name of Accounts at the
top of each ledger.
Cash Account
Ram,s Capital
Account

29. Cash Account
Dr. Cr.
Date Particulars JF Amount
AED
Date Particulars JF Amount
AED
Year
Month
Date
Accounts name Year
Month
Date
Accounts
name
Ram’s Capital Account
Dr. Cr.
Date Particulars JF Amount
AED
Date Particulars JF Amount
AED
Year
Month
Date
Accounts name Year
Month
Date
Accounts
name

30. Input the dates

31. Cash Account
Dr. Cr.
Date Particulars JF Amount
AED
Date Particulars JF Amount
AED
2003
June 1
Accounts name Year
Month
Date
Accounts
name

32. Start Debit side with “To”
Start “Credit side with “By”

33. Cash Account
Dr. Cr.
Date Particulars JF Amount
AED
Date Particulars JF Amount
AED
2003
June 1
To Rams
Account
Year
Month
Date
Accounts
name

34. Insert the amount

35. Cash Account
Dr. Cr.
Date Particulars JF Amount
AED
Date Particulars JF Amount
AED
2003
June 1
To Rams
Account
500,000 Year
Month
Date
Accounts
name

36. Sum up debit and credit side

37. Cash Account
Dr. Cr.
Date Particulars JF Amount
AED
Date Particulars JF Amount
AED
2003
June 1
To Rams
Account
500,000
500,000
Year
Month
Date
Accounts
name

38. Adjust debit credit with
Balance Carried Down or
Balance C/d

39. Cash Account
Dr. Cr.
Date Particulars JF Amount
AED
Date Particulars JF Amount
AED
2003
June 1
To Rams
Account
500,000
500,000
2003
June 30 Balance c/d 500,000
500,000

40. Carry forward the adjusted balance
Balance Brought Down or
Balance b/d

41. Cash Account
Dr. Cr.
Date Particulars JF Amount
AED
Date Particulars JF Amount
AED
2003
June 1
July 1
To Rams
Account
Balance b/d
500,000
500,000
500,000
2003
June 30 Balance c/d 500,000
500,000

42. Rams Capital Account
Dr. Cr.
Date Particulars JF Amount
AED
Date Particulars JF Amount
AED
2003
June 30 Balance c/d 500,000
500,000
2003
June 1
July 1
By Cash A/c
Balance b/d
500,000
500,000
500,000

43. Journalise the following transactions in the books of
Amar and post them in the Ledger:-
2004
March1 Bought goods for cash Rs. 25,000
2 Sold goods for cash Rs. 50,000
3 Bought goods for credit from Gopi Rs.19,000
5 Sold goods on credit to Robert Rs.8,000
7 Received from Robert Rs. 6,000
9 Paid to Gopi Rs.5,000
20 Bought furniture for cash Rs. 7,000
Illustration 3.

44. Journal of Amar

46. There are six accounts involved:
• Cash,
• Purchases,
• Sales,
• Furniture,
• Gopi &
• Robert,
so six accounts are to be opened in the
ledger.

47. Cash Account
In the Books of Amar

48. Purchases Account

49. Sales Account

50. Furniture Account

51. Gopi Account

52. Robert Account

53. The following are the advantages of ledger:
i. Complete information at a glance:
All the transactions pertaining to an account are collected at one place in
the ledger. By looking at the balance of that account, one can understand the
collective effect of all such transactions at a glance.
ii. Arithmetical Accuracy
With the help of ledger balances, Trial balance can be prepared to know
the arithmetical accuracy of accounts.
iii. Result of Business Operations
It facilitates the preparation of final accounts for ascertaining the
operating result and the financial position of the business concern.
iv. Accounting information
The data supplied by various ledger accounts are summarized, analyzed
and interpreted for obtaining various accounting information.
ADVANTAGES OF LEDGER

54. Compound or Combined Journal Entry is one where more than one
transactions are recorded by passing only one journal entry instead of
passing several journal entries.
Since every debit must have the corresponding equal amount of
credit, special care must be taken in posting the compound journal entry,
where there may be only one debit aspect but many corresponding credit
aspects of equal value or vise versa.
The posting of such transactions is done in the same way as already
explained.
Posting of Compound Journal Entries

55. Journal
Illustration 3 :
Jan. 12, 2003, Cash sales Rs.10,000, Cash received from
Kannan Rs.5,000 and commission earned Rs.2,500.