Posting from a General
Journal to a General
Ledger
Chapter 4
4.1 Preparing a Chart if
Accounts
O A journal does not show in one place all of
the changes in a single account
O For this reason a separate form is used to
summarize in one place all the changes to a
single account
O In the general ledger, up-to-date balances
must be calculated after every entry.
Vocabulary
O Ledger is a group of accounts
O General ledger is a ledger that contains all
the accounts needed to prepare financial
statements
O Account number is the number assigned to
an account
O Chart of accounts is a list of account titles
and numbers showing the location of each
account in a ledger
Accounts
O Accounts in the chart of accounts are listed
in the same order as they appear in financial
statements: 1)assets, 2)liabilities, 3)owner’s
equity, 4)revenue, 5)expenses
O First digit shows the general ledger division
O Second two digits indicate the location
within the division
O This business assigns account numbers by
10s so new accounts can be easily added
Opening an Account
O Is a very simple process
O Simply write the account name on the left
and the account number on the right
aplia
O 4.1 working together
O 4.1 application
Posting
O Transferring information from a journal entry
to a ledger account is called posting
O Numbers in the Post Ref columns serve
three purposes:
O An entry in an account can be traced to its
source
O An entry in a journal can be traced to where it
was posted in the account
O If posting is interrupted, one can easily see
where they stopped
Aplia
O 4.2 working together
O 4.2 application
Proving Cash
O Determining the amount of cash agrees with
the balance of the cash account in the
accounting records
O This company proves cash at the end of the
month
Correcting entry
O This is what you call a journal entry made to
correct an error in the ledger
O If an accounting error is discovered, a
memorandum is prepared describing the
correction to be made
Aplia
O 4.3 Work Together
O 4.3 Application
O 4.4 Mastery
O Chapter 4 Study Guide