ledger

Examples of ledger in the following topics:

• Posting

  • Posting is recording in the ledger accounts the information contained in the journal.
  • Each individual journal entry directs the input of a certain dollar amount as a debit in a specific ledger account, and directs the input of a certain dollar amount as a credit in a specific ledger account.
  • When posting the general journal, the date used in the ledger accounts is the date the transaction was recorded in the journal, not the date the journal entry was posted to the ledger accounts.
  • The general ledger contains all entries from both the General Journal and the Special Journals.
  • Describe how posting affects the General Journal, Special Journal and General Ledger

• Inputs to Accounting

  • Inputs into accounting include journal entries, the bookkeeping process, and the general ledger.
  • The bookkeeper is responsible for ensuring all transactions are recorded in the correct day book, suppliers ledger, customer ledger, and general ledger.
  • General Ledger is the final repository of the accounting records and data.
  • Each account in the general ledger consists of one or more pages.
  • The general ledger is where posting to the accounts occurs.

• The Accounting Cycle

  • The accounting cycle includes analysis of transactions, transferring journal entries into a general ledger, revenue, and expense closed.
  • These Journal entries are then transferred to a Ledger, which is the group of accounts, also known as a book of accounts.
  • The purpose of a Ledger is to bring together all of the transactions for similar activity.
  • Once the entries have all been posted, the Ledger accounts are added up in a process called Balancing.
  • This lists all the balances from all the accounts in the Ledger.

• Ledgers

  • So, what is a ledger?
  • Most organizations operate with two types of ledgers, the General Ledger and one or more subsidiary ledgers.
  • A General Ledger is a perpetual record of the activity and balances of the accounts.
  • Each company has only one General Ledger (Universal Accounting 2009)
  • The sum of the customer balances in the Accounts Receivable Subsidiary Ledger must equal the Accounts Receivable balance in the company's General Ledger.

• A short history of accounting and double entry bookkeeping

  • "The treatise described double-entry bookkeeping—that for every credit entered into a ledger there must be a debit, a concept created by Florentine merchants and hailed by Goethe as "one of the most beautiful discoveries of the human spirit".
  • It does this by ensuring that each individual transaction is recorded in at least two different (sections) nominal ledgers of the financial accounting system and so implementing a double checking system for every transaction.
  • A Debit value will always be recorded on the debit side (left hand side) of a nominal ledger account and the credit value will be recorded on the credit side (right hand side) of a nominal ledger account.
  • A nominal ledger has both a Debit (left) side and a Credit (right) side.
  • If the values on the debit side are greater than the value of the credit side of the nominal ledger then that nominal ledger is said to have a debit balance.Each transaction must be recorded on the Debit side of one nominal ledger and that same transaction and value is also recorded on the Credit side of another nominal ledger hence the expression Double-Entry (entered in two locations) one debit and one credit (Wikipedia 2009d).

• What Is a Receivable?

  • The accounts receivable departments use the sales ledger.
  • This is because a sales ledger normally records:

• Accounts Payable

  • In addition to its disclosure on the balance sheet, accounts payable is recorded in the A/P sub-ledger at the time an invoice is vouchered for payment.
  • Vouchered, or vouched, means that an invoice is approved for payment and has been recorded in the general ledger or A/P sub-ledger as an outstanding, or open, liability because it has not been paid.

• Bonds Issued at Par Value

  • All transactions made by the company in relation to the bond must be recorded in its general ledger.
  • The general ledger contains all entries from both the General Journal and the Special Journals.

• Activities to Manage Receivables

  • The accounts receivable departments use the sales ledger.
  • This is because a sales ledger normally records:
  • The entry would consist of debiting a bad debt expense account and crediting the respective accounts receivable in the sales ledger.

• Reporting Cash

  • A company's general ledger may have several accounts detailing how much cash it has.