Example of ledger postings

As we know that after the entries have been journalized, the next process is to transfer these entries to respective Ledger accounts. This process of transferring the entries from the General Journal to the Ledger is known ‘Posting’.

Under this process, various debit and credit transactions are posted to the ledger and at the end of a certain period, this debit and credit balanced is compared. Following is an example which will make clear how posting to the ledger is done:

Illustration

Post the-the following transactions in the books of a trader:-

Debit Balance on January 1, 2013

Cash in Hand $ 8,000, Cash at Bank $ 25,000, Stock of Goods $ 20,000, Building

$ 10,000. Sundry Debtors: Victor $ 2,000 and Rita $ 2,000.

Credit Balances on January 1, 2013:

Sundry Creditors: Albert $ 5,000. Capital $ 55,000

Following were further transactions in the month of January 2013:

Jan. 1               Purchased goods worth $ 5,000 for cashless 20% trade discount and 5% cash discount.

Jan. 4                 Received $ 1,980 from Victor and allowed him $ 20 as discount.

Jan. 8               Purchased plant from Michael for $ 5,000 and paid $ 100 as cartage for bringing the plant to the factory and another $ 200 as installation charges.

Jan. 12               Sold goods to Robert on credit $ 600.

Jan. 15               Robert became insolvent and could pay only 50 cent in a $.

Jan. 18              Sold goods to Steve for cash $ 1,000.

Solution

Cash A/c

Dr.							Cr.
Date   2013	Particular	J.F.	$	Date   2013	Particular	J.F.	$
Jan 1	To Balance b/d		8000	Jan 1	By Purchase A/c		3800
Jan 4	To Victor		1980	Jan 8	By Plant A/c		300
Jan 15	To Robert		300	Jan 31	By balance c/d		7180
Jan 18	To Sales A/c		1000
			11280				11280
Feb 1	To balance b/d		7180

Bank A/c

Dr.							Cr.
Date	Particular	J.F.	$	Date	Particular	J.F.	$
Jan 1	To balance b/d		25000	Jan 31	By Balance c/d		25000
			25000				25000
Feb 1	To balance b/d		25000

Stock A/c

Date	Particular	J.F.	$	Date	Particular	J.F.	$
Jan 1	To balance b/d		20000	Jan 31	By balance c/d		20000
			20000				20000
Feb 1	To Balance b/d		20000

Building A/c

Date	Particular	J.F.	$	Date	Particular	J.F.	$
Jan 1	To Balance b/d		10000	Jan 31	By Balance c/d		10000
			10000				10000
Feb 1	To Balance b/d		10000

Victor A/c

Date	Particular	J.F.	$	Date	Particular	J.F.	$
Jan 1	To balance b/d		2000	Jan 4	By cash A/c		1980
					By Discount A/c		20
			2000				2000

Rita A/c

Date	Particular	J.F.	$	Date	Particular	J.F.	$
Jan 1	To Balance b/d		2000	Jan 31	By Balance c/d		2000
			2000				2000
Feb 1	To Balance b/d		2000

Albert’s A/c

Date	Particular	J.F.	$	Date	Particular	J.F.	$
Jan 31	To balance c/d		5000	Jan 1	By Balance b/d		5000
			5000				5000
				Feb 1	By Balance b/d		5000

Capital A/c

Date	Particular	J.F.	$	Date	Particular	J.F.	$
Jan 31	To balance c/d		55000	Jan 1	By Balance b/d		55000
			55000				55000
				Feb 1	By Balance b/d		55000

Purchase A/c

Date	Particular	J.F.	$	Date	Particular	J.F.	$
Jan 1	To cash A/c		3800	Jan 31	By balance c/d		4000
	To Discount A/c		200
			4000				4000
Feb 1	To balance b/d		4000

Discount A/c

Date	Particular	J.F.	$	Date	Particular	J.F.	$
Jan 4	To Victor		20	Jan 1	By Purchases A/c		200
Jan 31	To balance c/d		180
			200				200
				Feb 1	By Balance b/d		180

Plant A/c

Date	Particular	J.F.	$	Date	Particular	J.F.	$
Jan 8	To Michael A/c		5000	Jan 31	By Balance c/d		5300
Jan 8	To Cash A/c		300
			5300				5300
Feb 1	To Balance b/d		5300

Michael

Date	Particular	J.F.	$	Date	Particular	J.F.	$
Jan 31	To balance c/d		5000	Jan 8	By plant A/c		5000
			5000				5000
				Feb 1	By balance b/d		5000

Sales A/c

Date	Particular	J.F.	$	Date	Particular	J.F.	$
Jan 31	To balance c/d		1600	Jan 12	By Robert		600
				Jan 18	By Cash		1000
			1600				1600
				Feb 1	By Balance b/d		1600

Robert’s A/c

Date	Particular	J.F.	$	Date	Particular	J.F.	$
Jan 12	To Sales A/c		600	Jan 15	By Cash A/c		300
				Jan 15	By Bad Debts A/c		300
			600				600

Bad Debts A/c

Date	Particular	J.F.	$	Date	Particular	J.F.	$
Jan 15	To Robert		300	Jan 31	By Balance c/d		300
			300				300
Feb 1	To balance b/d		300