Accounting: Chapter 4 Posting to a General Ledger

If an accounting error is discovered, a ...

*memorandum* is prepared as the source document describing the correction to be made.

A journal does not show ...

,in one place, all the changes in a single account.

The number in the Post. Ref. columns of the general ledger account and the general journal serve three purposes:

1. An entry in an account can be traced to its source in a journal. 2. An entry in a journal can be traced to where it was posted in an account. 3. If posting is interrupted, the accounting personnel can easily see which entries in the general journal still need to be posted.

Five General Ledger Divisions

1. Assets 2. Liabilities 3. Equity 4. Revenue 5. Expenses

Correcting Entry

If a transaction has been improperly journalized and posted to the ledger, the incorrect entry should be corrected with an additional journal entry, called a ...

Ledger

a group of accounts.

Gener Ledger

a ledger that contains all accounts need to prepare financial statements.

Chart of Accounts

a list of account titles and numbers showing the location of each account in a ledger. - Accounts are listed in alphabetical order. - EXCEPT: Cash; Petty Cash.

A journal is ...

a permanent record of the debit and credit parts of each transaction with transactions recorded in chronological order.

The T account is ...

a useful device for analyzing transactions into debit and credit parts.

Therefore, the posting reference is always recorded in the journal ...

as the *last* step in the posting procedure.

Proving Cash

determining that the amount of cash agrees with the balance of the Cash account in the accounting records.

A general ledger account is opened ...

for each account listed on the chart of accounts.

Accounts in a general ledger are arranged ...

in the same order as they appear on financial statements.

The Balance-Ruled Account Form

is an account form that has columns for the debit and credit balance.

The Balance-Ruled Account Form is ...

more useful than the T account as a permanent record of changes to account balances.

The month and the year are only written ...

once on a page of a ledger account unless the month or the year changes.

General ledger accounts are ...

part of the permanent records of a business and entries in the accounts are recorded in *ink*. Any corrections that need to be made should also be recorded in *ink*.

The first digit of each account number ...

shows the general ledger division in which the account in located.

All corrections should be made in a way ...

that leaves not question as to the correct amount.

A blank in the Post. Ref. column in the journal indicates ...

that posting for that line still needs to be completed.

Whenever the credits in an account exceed the debits ...

the balance is a credit.

Whenever the debits in an account exceed the credits ...

the balance is a debit.

An account form includes ...

the debit and credit columns and space for recording the transaction date and journal page number.

The second two digits indicate ...

the location of each account within a single general ledger division.

Account Title

the name given to an account.

Account Number

the number assigned to an account.

File Maintenance

the procedure for arranging accounts in a general ledger, and keeping records current.

A form is used ...

to summarize, in one place, all the changes to a single account; a separate form is used for each account.

Posting

transferring information from a journal entry to a ledger account.

Opening an Account

writing an account title and number on the heading of an account.