Accounting Finance Chapter 4 Posting to a General

Accounting & Finance Chapter 4 Posting to a General Ledger

Chapter 4 Vocabulary • Ledger – A group of accounts • General Ledger – Ledger that contains all accounts needed to prepare financial statements • Account Number – Number assigned to an account • File Maintenance – Procedure for arranging accounts in a general ledger, assigning account numbers and keeping records current

Chapter 4 Vocabulary • Opening an Account – Writing an account title and number on the heading of an account • Posting – Transferring information from a journal entry to a ledger account • Correcting Entry – An additional entry made to correct an improper journal entry

4 -1 Preparing a Chart of Accounts Relationship of a T Account to an Account Form T Account Information needed to trace entry back to journal page DEBIT CREDIT ACCOUNT DATE ITEM POST REF. DEBIT CREDIT

4 -1 Preparing a Chart of Accounts Relationship of a T Account to an Account Form ACCOUNT DATE ACCOUNT NO. ITEM POST REF. DEBIT CREDIT BALANCE DEBIT CREDIT Balance Columns

4 -1 CHART OF ACCOUNTS Tech. Know Consulting CHART OF ACCOUNTS Balance Sheet Accounts Income Statement Accounts (100) ASSETS (400) REVENUE 110 Cash 120 Petty Cash 410 Sales 130 140 150 160 510 Advertising Expense 520 Insurance Expense 530 Miscellaneous Expense 540 Rent Expense Accounts Receivable – Oakdale School Accounts Receivable – Campus Internet Cafe Supplies Prepaid Insurance (200) LIABILITIES 210 Accounts Payable – Supply Depot 220 Accounts Payable – Thomas Supply Co. (300) OWNER’S EQUITY 310 Kim Park, Capital 320 Kim Park, Drawing 330 Income Summary (500) EXPENSES 550 Supplies Expense 560 Utilities Expense

4 -1 ACCOUNT NUMBERS 1 General ledger division 5 0 Supplies Location within general ledger division Adding New Accounts 510 Advertising Expense (Existing Account) 515 Gasoline Expense (New Account) 520 Insurance Expense (Existing Account)

4 -1 Opening an Account in a General Ledger Account Title 1 ACCOUNT DATE Account Number 2 Cash ITEM ACCOUNT NO. POST REF. DEBIT CREDIT 110 BALANCE DEBIT CREDIT

W Chapter 4 -1 ORK TOGETHER Preparing a Chart of Accounts and Opening an Account Ross Company Chart of Accounts Balance Sheet Accounts Income Statement Accounts (100) ASSETS (400) REVENUE 110 Cash 120 Accounts Receivable – Megan Alvarez 410 Sales 130 Accounts Receivable – Tyler Link 140 Supplies 510 Automobile Expense 520 Insurance Expense 530 Miscellaneous Expense 540 Rent Expense 550 Supplies Expense 150 Prepaid Insurance (200) LIABILITIES 210 Accounts Payable – Mid City Supplies 220 Accounts Payable – Sherer Supplies (300) OWNER’S EQUITY 310 Clara Ross, Capital 320 Clara Ross, Drawing (500) EXPENSES New Accounts 515 Gasoline Expense 560 Utilities Expense

4 -2 Posting Separate Amounts from a Journal to a General Ledger Posting an Amount from a General Debit Column JOURNAL 1 DATE ACCOUNT TITLE 3 Supplies 1 DOC. POST NO. REF. PAGE 2 3 ACCOUNT DATE Aug. 3 3 ITEM POST REF. 1 Debit Amount DEBIT 275. 00 CREDIT 4 5 CASH DEBIT CREDIT 275. 00 Date Supplies SALES CREDIT GENERAL DEBIT CREDIT C 1 150 4 1 5 Account Number ACCOUNT NO. 150 BALANCE DEBIT CREDIT 275. 00 Account Balance 2 Journal Page

4 -2 Posting Separate Amounts from a Journal to a General Ledger Posting a Second Amount to an Account JOURNAL 1 DATE 1 ACCOUNT TITLE DOC. POST NO. REF. 2 C 1 150 275. 00 7 Supplies M 1 150 500. 00 ACCOUNT DATE A/P Supply Depot ITEM 2001 3 Supplies POST REF. 3 GENERAL DEBIT CREDIT 3 Supplies Date PAGE Debit Amount DEBIT Aug. 3 1 275. 00 7 1 500. 00 CREDIT 4 SALES CREDIT 1 5 CASH DEBIT CREDIT 275. 00 500. 00 Account Number 5 ACCOUNT NO. 150 BALANCE DEBIT CREDIT 275. 00 4 775. 00 Account Balance 2 Journal Page

4 -2 Posting Separate Amounts from a Journal to a General Ledger Posting an Amount from a General Credit Column JOURNAL 1 DATE ACCOUNT TITLE DOC. POST NO. REF. PAGE 2 3 GENERAL DEBIT CREDIT 4 SALES CREDIT 1 5 CASH DEBIT CREDIT 20 XX Aug. 1 Kim Park, Capital R 1 310 1 5000. 00 Date ACCOUNT DATE 20 XX Aug. 1 Kim Park, Capital ITEM POST REF. 1 Credit Amount DEBIT 5 3 CREDIT 5000. 00 Account Number ACCOUNT NO. 310 BALANCE DEBIT CREDIT 4 5000. 00 Account Balance 2 Journal Page

4 -2 W Chapter 4 -2 ORK TOGETHER Posting Separate Amounts to a General Ledger JOURNAL 1 DATE ACCOUNT TITLE DOC. POST NO. REF. DATE 2001 Mar. 1 POST REF. 1 DEBIT 3 SALES CREDIT 5000. 00 310 BALANCE DEBIT CREDIT 5000. 00 5 CASH DEBIT CREDIT 5000. 00 ACCOUNT NO. CREDIT 1 4 5000. 00 Leonard Witkowski, Capital ITEM 2 GENERAL DEBIT CREDIT Mar. 1 L. Witkowski, Capital R 1 310 ACCOUNT PAGE

4 -2 W Chapter 4 -2 ORK TOGETHER Posting Separate Amounts to a General Ledger JOURNAL 1 DATE ACCOUNT TITLE DOC. POST NO. REF. DATE Mar. 3 POST REF. 1 3 SALES CREDIT 660. 00 CREDIT 1 5 CASH DEBIT CREDIT 660. 00 ACCOUNT NO. DEBIT 4 660. 00 Prepaid Insurance ITEM 2 GENERAL DEBIT CREDIT 3 Prepaid Insurance C 1 140 ACCOUNT PAGE 140 BALANCE DEBIT CREDIT 660. 00

4 -2 W Chapter 4 -2 ORK TOGETHER Posting Separate Amounts to a General Ledger JOURNAL 1 DATE ACCOUNT TITLE DOC. POST NO. REF. DATE Mar. 4 SALES CREDIT ACCOUNT NO. POST REF. 1 4 78. 00 Supplies ITEM 3 78. 00 A/P Joshua’s Supplies ACCOUNT 2 GENERAL DEBIT CREDIT M 1 130 4 Supplies PAGE DEBIT 78. 00 CREDIT 130 BALANCE DEBIT CREDIT 78. 00 1 5 CASH DEBIT CREDIT

4 -2 W Chapter 4 -2 ORK TOGETHER Posting Separate Amounts to a General Ledger JOURNAL 1 DATE ACCOUNT TITLE DOC. POST NO. REF. M 1 130 4 Supplies 2 GENERAL DEBIT CREDIT DATE Mar. 4 POST REF. 1 DEBIT 4 SALES CREDIT 78. 00 Accounts Payable, Joshua’s Supplies ITEM 3 78. 00 A/P Joshua’s Supplies 210 ACCOUNT PAGE CREDIT 78. 00 ACCOUNT NO. 210 BALANCE DEBIT CREDIT 78. 00 1 5 CASH DEBIT CREDIT

4 -2 W Chapter 4 -2 ORK TOGETHER Posting Separate Amounts to a General Ledger JOURNAL 1 DATE ACCOUNT TITLE 9 A/R D. Braastad ACCOUNT DATE Mar. 9 DOC. POST NO. REF. POST REF. 1 2 S 1 120 GENERAL DEBIT CREDIT 163. 00 Accounts Receivable, Danielle Braastad ITEM PAGE DEBIT 163. 00 CREDIT 3 4 SALES CREDIT 163. 00 ACCOUNT NO. 120 BALANCE DEBIT CREDIT 163. 00 1 5 CASH DEBIT CREDIT

4 -2 W Chapter 4 -2 ORK TOGETHER Posting Separate Amounts to a General Ledger JOURNAL 1 DATE ACCOUNT TITLE 12 Rent Expense ACCOUNT DATE Mar. 12 DOC. POST NO. REF. 2 C 2 510 GENERAL DEBIT CREDIT 3 SALES CREDIT 1 DEBIT 375. 00 CREDIT 1 5 CASH DEBIT CREDIT 375. 00 ACCOUNT NO. POST REF. 4 375. 00 Rent Expense ITEM PAGE 510 BALANCE DEBIT CREDIT 375. 00

4 -2 W Chapter 4 -2 ORK TOGETHER Posting Separate Amounts to a General Ledger JOURNAL 1 DATE ACCOUNT TITLE DOC. POST NO. REF. DATE 2 GENERAL DEBIT CREDIT 15 A/P Joshua’s Supp. C 3 210 ACCOUNT POST REF. Mar. 4 1 15 1 DEBIT CREDIT 78. 00 50. 00 3 4 SALES CREDIT 50. 00 Accounts Payable, Joshua’s Supplies ITEM PAGE 1 5 CASH DEBIT CREDIT 50. 00 ACCOUNT NO. 210 BALANCE DEBIT CREDIT 78. 00 28. 00

4 -2 W Chapter 4 -2 ORK TOGETHER Posting Separate Amounts to a General Ledger JOURNAL 1 DATE ACCOUNT TITLE 16 A/R D. Braastad ACCOUNT DATE DOC. POST NO. REF. 2 POST REF. Mar. 9 1 15 1 3 GENERAL DEBIT CREDIT R 2 120 DEBIT 4 SALES CREDIT 100. 00 Accounts Receivable, Danielle Braastad ITEM PAGE CREDIT 163. 00 ACCOUNT NO. BALANCE DEBIT CREDIT 163. 00 100. 00 63. 00 5 CASH DEBIT CREDIT 100. 00 120 1

4 -2 W Chapter 4 -2 ORK TOGETHER Posting Separate Amounts to a General Ledger JOURNAL 1 DATE ACCOUNT TITLE DOC. POST NO. REF. DATE Mar. 25 1000. 00 Leonard Witkowski, Drawing ITEM POST REF. 1 2 GENERAL DEBIT CREDIT 25 L. Witkowski, Draw. C 4 320 ACCOUNT PAGE DEBIT 1000. 00 3 SALES CREDIT 1000. 00 ACCOUNT NO. CREDIT 4 320 BALANCE DEBIT CREDIT 1000. 00 1 5 CASH DEBIT CREDIT

4 -3 Posting Column Totals from a Journal to a General Ledger Check Marks show that Amounts are NOT Posted JOURNAL 1 DATE ACCOUNT TITLE DOC. POST NO. REF. Aug 20 Brought Forward 31 2 3 GENERAL DEBIT CREDIT 7960. 00 1284. 00 T 31 SALES CREDIT 4 5000. 00 290. 00 300. 00 8979. 00 1284. 00 ( ( ) 5 CASH DEBIT CREDIT 2439. 00 12319. 00 290. 00 A/P Ling Music M 3 1 PAGE ) 4411. 00 1429. 00 6019. 00

4 -3 Posting Column Totals from a Journal to a General Ledger Posting the Total of the Sales Credit Column JOURNAL 1 DATE ACCOUNT TITLE DOC. POST NO. REF. 2 GENERAL DEBIT CREDIT ACCOUNT DATE PAGE 3 SALES CREDIT ACCOUNT NO. ITEM POST REF. DEBIT CREDIT BALANCE DEBIT CREDIT 4 1 5 CASH DEBIT CREDIT

4 -3 Posting Column Totals from a Journal to a General Ledger Posting the Total of the Cash Debit Column JOURNAL 1 DATE ACCOUNT TITLE DOC. POST NO. REF. 2 GENERAL DEBIT CREDIT ACCOUNT DATE PAGE 3 SALES CREDIT ACCOUNT NO. ITEM POST REF. DEBIT CREDIT BALANCE DEBIT CREDIT 4 1 5 CASH DEBIT CREDIT

4 -3 Posting Column Totals from a Journal to a General Ledger Posting the Total of the Cash Credit Column JOURNAL 1 DATE ACCOUNT TITLE DOC. POST NO. REF. 2 GENERAL DEBIT CREDIT ACCOUNT DATE PAGE 3 SALES CREDIT ACCOUNT NO. ITEM POST REF. DEBIT CREDIT BALANCE DEBIT CREDIT 4 1 5 CASH DEBIT CREDIT

4 -4 Completed Accounting Forms and Making Correcting Entries Journal Page with Posting Completed JOURNAL 1 DATE ACCOUNT TITLE DOC. POST NO. REF. Aug 20 Brought Forward 2 GENERAL DEBIT CREDIT 7960. 00 2 PAGE 1284. 00 3 SALES CREDIT 4 CASH DEBIT CREDIT 2439. 00 12319. 00 21 T 21 270. 00 24 T 24 300. 00 25 T 25 310. 00 26 T 26 245. 00 27 Utilities Expense C 10 560 27 T 27 5 70. 00 5000. 00 70. 00 290. 00

Completed Accounting Forms and Making Correcting Entries 4 -4 Journal Page with Posting Completed cont. JOURNAL 1 DATE ACCOUNT TITLE DOC. POST NO. REF. 2 PAGE 2 3 GENERAL DEBIT CREDIT SALES CREDIT 4 CASH DEBIT CREDIT 28 Supplies C 11 150 28 T 28 31 Misc. Expense C 12 530 7. 00 510 5. 00 310. 00 31 B. Trevino, Draw. C 13 320 500. 00 245. 00 290. 00 Advertise Expense T 31 31 Misc. Expense M 3 530 31 Totals 434. 00 267. 00 31 267. 00 12. 00 3. 00 8979. 00 ( ) 5 70. 00 3. 00 1284. 00 ( ) 4411. 00 14291. 00 (410 ) (110 ) 6019. 00 ( 110 )

ACCOUNT Cash DATE ACCOUNT NO. POST REF. ITEM DEBIT CREDIT 110 BALANCE DEBIT CREDIT 2001 Aug. 31 2 2 14291. 00 6019. 00 ACCOUNT Petty Cash DATE ITEM 8272. 00 ACCOUNT NO. POST REF. DEBIT CREDIT 120 BALANCE DEBIT CREDIT 2001 Aug. 17 1 200. 00 ACCOUNT Accounts Receivable – Kids Time DATE ITEM POST REF. DEBIT ACCOUNT NO. CREDIT BALANCE DEBIT CREDIT 2001 Aug. 12 1 200. 00 130 200. 00

ACCOUNT DATE ACCOUNT NO. POST REF. ITEM DEBIT CREDIT BALANCE DEBIT CREDIT ACCOUNT DATE ACCOUNT NO. ITEM POST REF. DEBIT CREDIT ACCOUNT DATE BALANCE DEBIT CREDIT ACCOUNT NO. ITEM POST REF. DEBIT CREDIT BALANCE DEBIT CREDIT

ACCOUNT DATE ACCOUNT NO. POST REF. ITEM DEBIT CREDIT BALANCE DEBIT CREDIT ACCOUNT DATE ACCOUNT NO. ITEM POST REF. DEBIT CREDIT ACCOUNT DATE BALANCE DEBIT CREDIT ACCOUNT NO. ITEM POST REF. DEBIT CREDIT BALANCE DEBIT CREDIT

ACCOUNT DATE ACCOUNT NO. POST REF. ITEM DEBIT CREDIT BALANCE DEBIT CREDIT ACCOUNT DATE ACCOUNT NO. ITEM POST REF. DEBIT CREDIT ACCOUNT DATE BALANCE DEBIT CREDIT ACCOUNT NO. ITEM POST REF. DEBIT CREDIT BALANCE DEBIT CREDIT

ACCOUNT DATE ACCOUNT NO. POST REF. ITEM DEBIT CREDIT BALANCE DEBIT CREDIT ACCOUNT DATE ACCOUNT NO. ITEM POST REF. DEBIT CREDIT ACCOUNT DATE BALANCE DEBIT CREDIT ACCOUNT NO. ITEM POST REF. DEBIT CREDIT BALANCE DEBIT CREDIT

ACCOUNT DATE ACCOUNT NO. POST REF. ITEM DEBIT CREDIT BALANCE DEBIT CREDIT ACCOUNT DATE ACCOUNT NO. ITEM POST REF. DEBIT CREDIT ACCOUNT DATE BALANCE DEBIT CREDIT ACCOUNT NO. ITEM POST REF. DEBIT CREDIT BALANCE DEBIT CREDIT

Completed Accounting Forms and Making Correcting Entries Journal Page with Posting Completed cont. JOURNAL 1 DATE ACCOUNT TITLE DOC. POST NO. REF. 1 Advertise Expense. M 87 Misc. Expense PAGE 2 GENERAL DEBIT CREDIT 140. 00 3 SALES CREDIT 4 2 5 CASH DEBIT CREDIT