1. Week 4

2.  Contains a chronological list of transactions all in
one place.
 Does not tell business owner what the account
balances are for each account.

3.  Book of final entry; accumulates all entries to
arrive at a final balance for all accounts
 Process of transfer from journal to ledger is known
as posting.

4.  Account title and account number
 Date of transaction from journal
 Post Ref is page of journal
 Debit/Credit of transaction from journal
 Balance calculated from debit/credit posted

5.  Record date and amount of transaction from the
journal (debit or credit)
 Record posting reference (journal page)
 Calculate new account balance by extending debit
or credit to right (think normal balance)
 Record account number in Post Ref column of the
journal page.

7.  List of individual accounts and their debit or credit
balance as taken from ledger.
 Listed in same order as found in ledger.
 All accounts are listed, even accounts with a zero
balance.
 Total debit and credit columns to see if debits
equal credits.
 What if trial balance doesn’t balance?

8.  What to check.
◦ Omitted transaction.
◦ Transaction entered incorrectly in journal.
◦ Journal entry posted incorrectly in ledger.
◦ A debit balance placed in credit column or a credit
balance placed in debit column of trial balance.

9.  Amount of difference is 10 or 100 or 1,000 check your
addition.
 Difference equal to an account balance check if
amount was omitted or not posted.
 Divide difference by 2 and check for that amount in the
higher column total. Check to see if a debit of that
amount should have been a credit and vice versa.
 Compare balance in trial balance to balances in ledger
to check for copying errors.

10.  Is difference evenly divisible by 9? If so may be a
slide or transposition error.
◦ $2,150.00 copied as $21.50
◦ $2, 150 copied as $2,510
 Recalculate balances in ledger accounts.
 Trace journal to ledger postings.

11.  Business tracks transaction for a specified period
of time known as the accounting period or the
fiscal period.
 At end of fiscal period the business needs to
prove the equality of debits and credits.
 Do the totals of all debit account balances equal
total of all credit account balances?
 This is done by preparing a trial balance.
 Must prepare trial balance before reporting
financial information in financial statements.

12. Questions?