Chapter 7
Posting
The T Account
• Simplified version
of ledger account
• Includes:
▫
▫
▫
▫
Accounts Payable
Account name
June 15
Debits
Credits
386
Dates of
transactions
▫ Final account total
7.1
386 May 3
386
275 Aug. 14
661
275
Balance Column Account
Accounts Payable
386 May 3
June 15 386
275 Aug. 14
386
661
275
• Same information as T-account
7.1
Balance Column Account
386
661
275
• Running account total recorded in a third
column rather than at the bottom
7.1
Balance Column Account
• Account balance indicated as Debit or
credit in DR. CR. column
7.1
The Accounting Cycle
Transactions
occur
Record in
Journal
Trial
Balance
Balance
Sheet
Income
Statement
7.1
Post
in Ledger
Posting
6 Steps: Recording journal entries in the ledger
1. Go to correct ledger page for account
2. Record date of transaction
3. Record page number of Journal in Posting
Reference (PR) column
4. Record amount in Debit or Credit column
5. Calculate new account balance and record if
balance is DR. or CR.
6. Go back to journal and record ledger
account in the Posting Reference column
(PR)
7.1
Cross Referencing
• Recording the journal page number
in the ledger account
• Recording the Account number in the
journal entry
• Why?
▫ Trace back to source
▫ Entries can be followed
▫ Easy to tell where you left off
7.1
Most Common Errors
• The DR. CR. Column
▫ Identifies if the BALANCE of the account
is a Dr or Cr
▫ NOT related to the transaction
• Recording PR out of order
▫ Do not record all the PRs first or last
▫ As each journal entry is posted the PR is
recorded
• Posting All of one Account
▫ Must do each journal entry one line at a
time or it will NOT BALANCE
7.1
7.1 Homework
• Page 219 (wb 115-120)
▫ Questions 1-16
▫ Exercises 1-3
 Exercise 1 calculating account balances
▫ Remember DR/CR is for account
balance
 Exercise 2 posting (in the workbook only)
▫ Follow the 6 Steps
 Exercise 3 forwarding balance to next
page (in the workbook only)
▫ see text pg 218 for example
7.1
Trial Balance Out of Balance
• Make sure account balances are in the
correct column
• Find the difference between the totals
• Find that value in a transaction
▫ Missed an entry
• Divide difference by two and find
▫ Double entry
• Difference divisible by 9
▫ Transposition error (wrote 45 instead of 54)
• Difference divisible by 10
▫ Addition Error (forgot to carry the one)
7.2
Simply Accounting
Assignment