Beruflich Dokumente
Kultur Dokumente
Prepared by:
Raza Saeed,
FCMA, MBA, ACIS, CIA, DAIBP
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Learning Objectives
After studying this chapter, you should be able to
The Ledger
• The form of record used to record increase or decrease in
a single balance sheet, liabilities and Owners Equity item
is called an account or sometime a ledger account.
• Entire group of account is called a ledger.
• Element of account:
• A title , name of particular asset, liabilities and Owners
Equity
• A left side, called Debit side
• A right side, called Credit side
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Cash
9/1 $180,000 9/3 $141,000
9/30 3,000
181,500 159,000
Cash Land
9/1 (a) 180,000 9/3 (b) 141,000 9/3 (b) 141,000
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Cash Building
9/1 (a) 180,000 9/3 (b) 141,000 9/5 (C) 36,000
9/5 (c) 15,000
Accounts Payable
9/5 (c) 21,000
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Cash Account #
Date Explanation Ref Debit Credit Balance
20----
3 141,000 39,000
5 15,000 24,000
20 1,500 25,500
30 3,000 22,500
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The Journal
• Initially each transaction is recorded in an accounting
record – Journal or book of original entry
• After transaction recorded in Journal, debit and credit
changes in the individual accounts are recorded in the
Ledger.
• Chronological record of business transaction
• Advantages – use of journal and Ledger
• Journal provide all information about transaction in one place and
also an explanation of the transaction
• Journal provide a chronological record of all the events in the life of
the business
• Journal helps to prevent errors
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General Journal
General Journal Account #
Date Account Title and Explanation LP Debit Credit
20----
General Journal
General Journal Account #
Date Account Title and Explanation LP Debit Credit
20----
Cash Account # 1
Date Explanation Ref Debit Credit Balance
20----
3 141,000 39,000
5 15,000 24,000
20 1,500 25,500
30 3,000 22,500
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20 1,500 9,500
Land Account # 20
Date Explanation Ref Debit Credit Balance
20----
10 11,000 130,000
18
14 5,400 26,400
30 3,000 23,400
Trial Balance
• Proof of the equality of debit and credit balance is called
Trial Balance
• Two column schedule listing the names and balances of
all the accounts in the order in which they appear in the
Ledger
• Debit balances are listed in left hand column and
Credit balances in the right hand column
• Total of two columns should agree
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Accounting Cycle
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THANK YOU