ledger account , entry posting , how to prepare ledger account

2. The ledger is the principal book of
accounting system. It contains
different accounts where
transactions relating to that
account are recorded .A ledger is
the collection of all the accounts
,debited or credited ,in the journal
proper and various special journal.

3. A ledger is very useful and is of
utmost importance in the
organization. The net result of all
transactions in respect of a
particular account on a given date
can ascertained only from the
ledger

4. Name of the
account
Dr Cr
date particulars J.F Amount date particulars J.F amount

5. Title of the account : The name of the item
is written at the top of the format as the
title of the account .the title of the account
ends with suffix account
Dr :Dr means debit side of the account that
is left side and Cr means credit side of the
account
Particulars :Name of the item with
reference to the original book of entry is
written on debit/credit side of the account

6. Journal folio : It records the page number
of the original book of entry on which
relevant transaction is recorded .this
column is filled up at the time of posting
Amount :This column records the amount
in numerical figure, corresponding to what
has been entered in the amount column of
the original book of entry

7. The journal is the book of first entry
;The ledger is the book of second entry
The journal is the book for chronological
record ;The ledger is the book for analytical
record
The journal. as a book of source entry ,gets
greater importance as legal evidence than the
ledger

8. Transaction is the basis of classification of
data within the journal ; account is the
basis classification of data within the
ledger
Process of recording in the journal is called
journalising ; the process of recording in
the ledger is known as posting

9. Ledger accounts are classified in to five
categories namely assets, liabilities,
capital, revenues/ gains, and expense
losses. All these accounts may further be
put in to two groups, i.e. permanent
accounts and temporary accounts .All
permanent accounts are balanced and
carried forward to the next accounting
period .

10. What does aLedger include?
It usually includes accounts for items like current assets, fixed assets,
liabilities, revenue and expenseitems, gainsand losses.
Each General Ledger is divided into debits and credits sections. The left
hand side lists debit transactions and the right hand side lists credit
transactions.

11. Ledger Maintaining
Sales Book Purchase Book Cash Book
General
Journals
Ledger
Ledgeris composed by posting transactions recorded in the sales
book, purchases book, cashbook and general journalsbook.

12. Ledger Maintaining
Thegeneral ledger canbe supported by one or more subsidiary ledgers that
provide details foraccounts in the general ledger.
For E.g. An accounts receivable subsidiary ledger would contain a separate account for each credit
customer, tracking that customer's balance separately. This subsidiary ledger would then be totaled
and compared with its controlling account (in this case, Accounts Receivable) to ensure accuracy as
part of the process of preparing atrialbalance.

13. Balancing Ledger
Because each bookkeeping entry debits one account and credits
another account in an equal amount, the double-entry bookkeeping
system helps in ensuring that the general ledger is always in balance,
thus maintaining the accountingequation

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