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Legder and Trail Balance - Lecture - Accounting - Dr. Kalra, Lecture notes of Accounting

Description about Ledger and Trial Balance, Ledger, Advantages of Ledger, Proforma of Ledger,Rules of Posting.

Typology: Lecture notes

2010/2011

Uploaded on 09/07/2011

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Ledger
Business transactions are first entered in Journal or subsidiary books. The
next step is to transfer the entries to respective accounts in Ledger. In
other words, all entries recorded in Journal or Subsidiary Books are
classified and in order to ascertain the position of a particular account, all
transactions relating to that particular account are collected at one place in
the Ledger. In short, a ledger is a book which contains all accounts of the
business enterprise whether Personal, Real, Nominal.
“The book which contains a classified and permanent record of all the
transactions of a business is called the Ledger”
- L.C.
Cropper
Advantages of Ledger:
a) Easy to understand the collective effect of all transaction
b) Easy excess of information
c) Help in preparing Trial balance
d) Help in preparing Trading and Profit & Loss A/c
e) Help in preparing Balance Sheet
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Ledger

 (^) Business transactions are first entered in Journal or subsidiary books. The

next step is to transfer the entries to respective accounts in Ledger. In other words, all entries recorded in Journal or Subsidiary Books are classified and in order to ascertain the position of a particular account, all transactions relating to that particular account are collected at one place in the Ledger. In short, a ledger is a book which contains all accounts of the business enterprise whether Personal, Real, Nominal.

“The book which contains a classified and permanent record of all the transactions of a business is called the Ledger”

  • L.C. Cropper

 (^) Advantages of Ledger:

a) Easy to understand the collective effect of all transaction

b) Easy excess of information

c) Help in preparing Trial balance

d) Help in preparing Trading and Profit & Loss A/c

e) Help in preparing Balance Sheet

Proforma of Ledger Dr. Cr.

Date Particulars J.F. Amount Date Particulars J.F. Amount

 Rules of Posting:

1.All transactions relating to one account should be entered at one place. 2.The word “To” is used before the account which appears on the debit side and “By” is used before the account which appears on the credit side. 3.If an account has been debited in the Journal Entry, it should be recorded on the debit side of Ledger. 4.If an account has been credited in the Journal Entry, it should be recorded on the credit side of Ledger. 5.Similar amount which has been posted on the debit side of an account should also be posted on the credit side of another account. 6.Its not necessary to write the word “A/c” after personal accounts.