Page 70 - DCOM101_FINANCIAL_ACCOUNTING_I

Financial Accounting-I Sukhpreet Kaur, Lovely Professional University

Notes Unit 7: Posting to Ledger and Balancing

CONTENTS

Objectives
Introduction
7.1 Preparation of Ledger
7.2 Ledger Posting
7.3 Balancing

7.4 Summary
7.5 Keywords
7.6 Self Assessment
7.7 Review Questions

7.8 Further Readings
Objectives

After studying this unit, you will be able to:
z Prepare ledger
z Make ledger posting
z Illustrate the balancing of accounts

Introduction

You have learnt that business transactions are recorded in various special purpose books and
journal proper. The accounting process does not stop here. The transactions are recorded in
number of books in chronological order. Such recording of business transactions serves little
purpose of accounting. Items of same title in different books of accounts need to be brought
at one place under one head called an account. There are numerous account titles of items/
persons or accounts. All the accounts, if brought in one account book, will be more informative
and useful. The account book so maintained is called Ledger.

7.1 Preparation of Ledger

Classification of transactions is being done only on the basis of preparing the ledger accounts.

The accounts are classified on the basis of nature and characteristics.

?
Did u know? How are the account transactions classifi ed?
The accounts are classified through the preparation of ledger.

Ledger is nothing but preliminary book of accounting transactions at which, each account is
separately maintained through the allotment of various pages for exclusive recording. The

exclusive allotment of pages is made for every account to finalize their balances. Finally, ledger
can be understood that is a document of grouping the transactions under one heading.

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