1) The document discusses ledger accounts, which record all transactions relating to a particular person, firm, or item. It explains how accounts have debit and credit sides and how transactions are posted from journals to ledgers. 2) Sample ledger accounts are provided and the rules for posting debits and credits to the appropriate sides of accounts are described. 3) Journal entries for sample transactions are provided and posted to ledger accounts, with debits posted to the debit side and credits posted to the credit side along with details like date, particulars, and journal folio.

1. LEDGER
Amitabha Maheshwari
Faculty Finance
PIMG

2. LEDGER AND POSTING
• The place where record of all business transactions relating
to a particular person, firm or an item is- kept is termed as
'Account'. The book is which such accounts are kept is
termed as 'Ledger'
• Thus, an account is a record of all the transactions in
summarized form that have taken place in relation to a
particular person or thing specified. Account is prepared and
presented in 'T' shape, divided into two equal sides.
Traditionally, the left side is called Debit (Dr.) side and right
side is called credit (Cr.) side.

3. LEDGER AND POSTING
• The specimen of an account is given below:
LEDGER ACCOUNT
Date
DR.
Particulars
J.F.
Amount
Date
Particulars
J.F.
Amount
CR.
• Description of Ledger Account: The Account is divided into two
equal parts i.e., Debit Side and Credit Side. Each side has four
columns: Date, particulars, J.E and Amount. The description of each
column is given below:
• 1. Date: The date of transaction which is recorded in
Journal/Subsidiary Book is written in this column.
• 2. Particulars: 'To' and 'By' words are written is Debit and Credit side
respectively and name of opposite account of the particulars journal
entry is also written.

4. LEDGER AND POSTING
• 3. Journal Folio: The page number of Journal or Subsidiary book
having the entry is written in this column. 'J.E' means 'Journal Folio' or
page number of 'Journal'. Here, Subsidiary Books are also termed as
special Journals.
• 4. Amount: The amount of related transaction is written in this
column.

5. LEDGER AND POSTING
• The process of transferring the information contained in a Journal to a
Ledger is called posting.
• The following rules should be kept in mind while posting transactions
in the ledger from the Journal:
• 1. Separate accounts should be opened in the ledger for posting
transactions relating to different accounts recorded in the Journal.
• 2. The concerned account which has been debited in the journal should
also be debited. However, a reference should be made of the other
account which has been credited in the journal.
• 3. The credit of the journal entry is posted to the credit side of the
account but a reference should be given of the other account which has
been debited in the journal.

6. LEDGER AND POSTING
• 5. In the folio column, the page number of journal from where the entry is
transferred to ledger account is written.
• 6. The date of the transaction is written on the date column.
• The following procedure is followed for posting the debit' and credit aspect
of the transaction recorded in a Journal
• (i) Posting of Account debited in a Journal entry: The steps to be followed
are:
• First: Identify in the Ledger the account to be debited.
• Second: Enter the date of the transaction in the 'Date' column on the debit
side of the account.
• Third: Write the name of the account which has been credited in the
respective entry in the 'Particulars Column' on the debit side of the account as
'To (name of account credited)'.
• Fourth: Record the page number of the Journal where the entry exists in the
folio column.
• Fifth: Enter the relevant amount in the 'Amount' column on the debit side.

7. LEDGER AND POSTING
• (ii) Posting an Account credited in a Journal entry: The steps to be
followed are:
• First: Identify in the Ledger the account to be credited.
• Second: Enter the date of the transaction in the 'Date' column on the
credit side.
• Third: Write the name of the account which has been debited in the
respective entry in the 'Particulars Column' on the credit side of the
account as 'By (name of account debited)'.
• Fourth: Record the page number of the Journal where the entry exists
in the folio column.
• Fifth: Enter the relevant amount in the 'Amount' column on the credit
side.

8. Journalize the following transactions, post them in Ledger
Accounts and balance them:
• 2007
Rs.
• April 1 Kamal started business with cash
1,00,000
• April 2 Bought goods for cash
30,500
• April 3 Opened Bank Account with cash
50,000
• April 4 Sold goods for cash
40,000
• April 7 Bought goods from Surya on credit
30,000
• April 10 Sold goods to Rakesh on credit
25,000

9. • April 15 Purchased Plant and Machinery
and payment is made by cheque
• April 19 Paid to Surya in cash
• April 21 Received loan from Anil and deposited
the same into bank
• April 23 Goods returned to Surya
• April 26 Withdrew from bank for personal use
• April 27 Paid to Surya by cheque
• April 29 Received cash from Rakesh
• April 30 Purchased stationery for cash
• April 30 Paid wages and salaries
16,600
10,000
8,000
1,000
5,000
8,000
10,000
200
10,000

10. Date
Particular
2007
April 1
Cash A/c
To Capital A/c
Dr.
Purchases A/c
To Cash A/c
Dr.
April 2
April 3
April 4
L.F. Dr.(Rs.)
Cr.(Rs.)
1,00,000
1,00,000
Bank A/c
Dr.
To Cash A/c
(Being a bank account opened by
depositing)
Cash A/c
Dr.
To Sales A/c
(Being goods sold for cash)
30,500
30,500
50,000
50,000
40,000
40,000

11. Date
April 7
April 10
April 15
April 19
Particular
L.F.
Dr.(Rs.)
Purchases A/c
Dr.
To Surya
(Being goods purchased on credit from
Surya)
Rakesh
Dr.
To Sales A/c
(Being goods sold to Rakesh on credit)
30,000
Plant and Machinery A/c
Dr.
To Bank A/c
(Being plant and machinery purchased by
cheque)
Surya
Dr.
To Cash A/c
(Being amount paid to Surya in cash)
Cr.(Rs.)
16,600
30,000
25,000
25,000
16,600
10,000
10,000

12. Date
Particular
L.F. Dr.(Rs.)
Bank A/c
Dr.
To Anil’s Loan A/c
April 21
(Being loan from Anil received and
deposited into bank)
Surya
Dr.
To Returns Outwards A/c
April 23
(Being goods returned to Surya)
8,000
Drawings A/c
Dr.
To Bank A/c
April 26
(Being amount withdrawn from bank for
personal use)
Surya
Dr.
To Bank A/c
April 27
(Being amount paid to Surya by cheque)
Cr.(Rs.)
5,000
8,000
1,000
1,000
5,000
8,000
8,000

13. Date
Particular
Cash A/c
L.F.
Dr.
Dr.(Rs.)
Cr.(Rs.)
10,000
To Rakesh
April 29
(Being cash received from Rakesh)
10,000
Stationery A/c
Dr.
To Cash A/c
April 30
(Being stationery purchased for cash)
200
Wages and Salary A/c
Dr.
To Cash A/c
April 30
(Being wages and salaries paid in cash)
10,000
200
10,000