GENERAL LEDGER

A general ledger represents the record-keeping system for a company's financial data
with debit and credit account records validated by a trial balance. The general ledger provides
a record of each financial transaction that takes place during the life of an operating company.
The general ledger holds account information that is needed to prepare the company's
financial statements, and transaction data is segregated by type into accounts for assets,
liabilities, owners' equity, revenues, and expenses. There are some functions of general
ledger, such as a tool to summarize transaction data that has been recorded in a journal
(general), a tool to classify financial data and be able to find out the actual number or state of
the account whether there is a difference or not, a basis for classifying transactions that are or
have been recorded in a journal and material or information for preparing financial
statements.

The shape of the ledger is divided into two columns, three columns, four columns,
and T forms. The two columns accounts are called skontro ledgers. A three-column account is
called a staff ledger for special balances. The four column account is called the double
balance staff ledger ledger and the simplest ledger is the T form. The most important step
when the general ledger are used is Posting. Posting is the transfer of books from general
journals to ledgers according to the account name. The following steps are taken in posting to
the ledger. First of all, determine the type of account that is affected by transactions in the
journal; second, record the transaction date according to the date in the journal; the third write
a brief description of the transaction as stated in the journal; and the last is record the account
code in the ref column, journal in the account number, and record the journal page in the
ledger ref column.

There are a lot of transactions that are posted to the general ledger, such as credit sales
transactions. These entries record increases and decrease to the business’s assets, liabilities
and owner’s equity accounts. The second is asset transactions. For example, the purchase or
sale of physical or intangible assets, cash collection from credit customers, depreciation of
property or equipment, and credit or cash sales to customers. The third is liability
transactions, for example: payment of accounts payable, credit purchases by the business and
business expenses, such as salaries, taxes and interest, that may be paid off by the end of the
current or future fiscal year. The last is other transactions. General ledger journal entries can
also be used to reclassify amounts. For example, a long-term liability that comes due in the
current fiscal year should be transferred from a long-term liability to a current liability
account.