Accounting and Finance Foundations

Unit 6

Accounting and Finance Foundations Unit 6: Journalizing 471

Journalizing

Chapter 16Chapter 6

Lesson 16.3 Posting to the General Ledger

After journalizing each transaction, the next step in the accounting cycle is posting to the general ledger—

the final book of entry. The general ledger is the running total of all accounts listed in the chart of accounts.

(If you store the chart of accounts on a hard drive, the total of the accounts in the data files is the ledger.)

There are a couple of different ways to post general journal entries into the general ledger. One way to post

to the general ledger is to include every detail from the general journal. But, if you prefer not to record

quite so much data in the general ledger, you can total the debits and/or credits for each account from the

general journal and post just those totals in the general ledger, as illustrated below. If using an accounting

system, you could “drill down” on a specific account to access more details.

So, posting Mrs. King’s Interiors’ general journal data (from the last exercise) into the general ledger would

look like this:

The general ledger includes all business transactions from the very beginning of the business. For some

business entities, there could be over a thousand different accounts listed in the chart of accounts and,

therefore, in the general ledger. To provide additional detailed information for each of these many

accounts, you should create and use subsidiary ledgers.

Student Guide

General Ledger

December 20YY

Beginning

Balance

$0.00

Date

General

Ledger

Account

Description of Transaction Debit Credit Balance

1 12/31/20YY 110 Cash $30,550.00 $30,550.00

2 12/31/20YY 120 Accounts Receivable $2,500.00 $33,050.00

3 12/31/20YY 130 Supplies $10,650.00 $43,700.00

4 12/31/20YY 210 Accounts Payable $6,500.00 $37,200.00

5 12/31/20YY 310 Capital, Mrs. King $30,500.00 $6,700.00

6 12/31/20YY 320 Owner’s Draw, Mrs. King $600.00 $7,300.00

7 12/31/20YY 330 Income Summary Account $7,300.00

8 12/31/20YY 410 Revenue, Design Services $8,000.00 -$700.00

9 12/31/20YY 420 Revenue, Design Products -$700.00

10 12/31/20YY 510 Rent Expense $500.00 -$200.00

11 12/31/20YY 520 Utilities Expense $200.00 $00.00