POSTING & TRIAL BALANCE

POSTING The process of transferring the entries in the journal to the proper account in the ledger STEPS FOLLOWED IN POSTING 1) Locate in the ledger the first account named in the journal entry 2) Enter the date of the transaction under the Date column in the ledger account 3) Enter in the debit column of the ledger account the amount of the debit as shown in the journal. 4) Enter in the Folio column of the ledger the page number of the journal from which the entry is being posted 5) Return to the journal and enter in the Folio column the account number of the ledger to which posting was made. 6) Repeat the posting process described in the preceding five steps for the credit side of the journal entry. FOOTING Determining the balance of the ledge accounts STEPS IN FOOTING 1) Add all amounts recorded under the DR column. 2) Record the column totals immediately below the last entry in the column, in small pencil figure. 3) Repeat steps 1 and 2 for the credit entries. 4) Get the difference between the DR and CR totals. The difference, representing the balance of the account, is written on the side which has the bigger total, 5) Write the difference or balance of the account under the Item column, in line with the last entry in the column, in small pencil figures. 6) If there is only one entry in only one side of the account, there is no need to foot the account. The lone entry serves as the balance of the account. 7) When there is only one entry on each side of the account, simply get the difference between these two entries. Record the difference or balance under the Item column on the side which has the bigger total, in small pencil figures 8) When there are two or more entries in only one side of the account, simply get the total of the column, and record this total immediately below the last entry in the column in small pencil figures.

LESSON VI

TRIAL BALANCE Listing of general ledger accounts and their respective balances Proves the correctness of posting Facilitates the preparation of the worksheet The heading of the trial balance consists of: Name of company Trial Balance Date of Trial Balance TYPES OF TRIAL BALANCE A. Trial Balance of Balances Summary of accounts in the ledger and their respective balances Basis for the preparation of the worksheet B. Trial Balance of Totals Summary of accounts in the ledger and their respective debit and credit totals

Illustration: Villa Fitness Center Trial Balance January 31, 2009 Account Numbers 11 12 13 14 21 31 32 41 51 52 53 Account Titles Cash Accounts Receivable Office Supplies Office Equipment Accounts Payable S. Villa, Capital S. Villa , Drawing Fees Income Salaries Expense Advertising Expense Telephone Expense Total DR 10.000 4,000 1,500 17,500 4,500 22,000 1,000 16,500 5,000 2,000 2,000 43,000 CR

43,000

Trial Balance of Balances

Villa Fitness Center Trial Balance of Totals January 31, 2009 Account Numbers 11 12 13 14 21 31 32 41 51 52 53 Account Titles Cash Accounts Receivable Office Supplies Office Equipment Accounts Payable S. Villa, Capital S. Villa , Drawing Fees Income Salaries Expense Advertising Expense Telephone Expense Total DR 30.000 6,000 1,500 17,500 1,500 1,000 16,500 5,000 2,000 2,000 66,500 CR 20,000 2,000

6,000 22,000

66,500

Trial Balance of Totals