UNIVERSITY OF SAINT LOUIS

Tuguegarao City

SCHOOL OF ACCOUNTANCY, BUSINESS and HOSPITALITY

First Semester
Academic Year 2021-2022

ONLINE LEARNING MODULE

ACCT 1026- Financial Accounting and Reporting

Lesson 4: Posting of Transactions and Preparation of Trial Balance

REMINDERS:
 Lessons will be uploaded every Monday, and submission of assessments will be every Friday of the
week.
 Comply with all requirements (written outputs, projects/performance tasks examinations and the like.)
 Turn in learning tasks on time to avoid backlogs.
 For this week, the following shall be your guide for the different lessons and tasks that you need to
accomplish. Be patient, read them carefully before proceeding to the tasks expected of you.

Date Topics Activities or Tasks

Sept 6 I. Posting to the ledger Read Lessons from books and handouts
Sept 7 A. Posting of Transactions Online discussion
Sept 8 B. Preparation of the Unadjusted Trial Accomplish the drills and exercises
Balance
Sept 9 Submission of Assessments
Sept 10 Participate in the scheduled Quiz
Learning At the end of this module, you are expected to :
Outcomes: 1. Describe the General Ledger and understand what purpose it serves.
2. Post entries from the general journal to the general ledger
3. Prepare and explain the use of a trial balance
4. Perform steps in locating errors

LEARNING CONTENT

Are you burnout? Mainly because of COVID and secondly, your assessments? Read the quotes below . . .
again and again, if you are.

Yes, the right frame of mind is called right A T T I T U D E, all caps for emphasis. If you are not yet
inspired, read the story of David and Goliath in the holy Bible. . . .. Believe you can, and you can!!!.

https://tr.pinterest.com/pin/209487820148840392/
ACCT 1026 – Financial Accounting and Reporting | 1

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Let us continue our study of the accounting cycle.

Steps in the Accounting Cycle:

1. Identifying and Analyzing – finished

2. Recording or Journalizing - finished
3. Posting to the Ledger –It is done by transferring the data in the Journal to the General Ledger for
classification.
4. Preparing the Unadjusted Trial Balance –It aims to periodically test the equality of the total debits
and total credits in the general ledger. Normally, this is done at the end of each month.

Posting to the General Ledger

General Ledger (GL) is the book of final entry while the Journal is the book of original entry.

The best way to explain the purpose of the general ledger is through a diagram:

http://www.leoisaac.com/fin/fin049.htm

Explaining the purpose of the General Ledger is perhaps a difficult task. One reason is because in this age
of computers and information technology, the General Ledger does not any longer have an easily identifiable
physical form. Most large companies have their own system that will post transactions daily to the Journal
then to the General Ledger and from the Ledger to the Subsidiary Ledgers. And all the Accountant has to do
is print a daily report, perform reconciliation of balances between the General Ledger and Subsidiary Accounts
and maintain a permanent file of these reports.

ACCT 1026 – Financial Accounting and Reporting | 2

WARNING: No part of this E-module or LMS contentcan be reproduced or transported or shared

to others without permission from the University of Saint Louis. Unauthorized use of the
materials, other than personal learning use, will be penalized. Please be guided accordingly.
For companies that are still using the manual system, the standard format of the general ledger for Cash is
shown below:

http://www.leoisaac.com/fin/fin049.htm

There are three columns for recording money - Debit, Credit and Balance. There is one page in the General
Ledger for each Account, and typically the number of Accounts will be many, depending on the Chart of
Accounts.

The manual process of posting involves transferring the date, debit and credit totals of accounts from the
General Journal to the G/L. A recorded journal entry is copied to its specific account in the GL.

Purpose: To classify the effects of business transactions according to the five (5) elements of financial
statements: Assets, Liabilities, Owner’s Equity, Income and Expense. This will greatly help the accountant
to prepare the financial statements in an orderly and timely manner.

For classroom discussion, we will be using the informal form of the G/L which is the T-account.

https://www.wallstreetmojo.com/t-accounts/

Example:
ACCT 1026 – Financial Accounting and Reporting | 3

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materials, other than personal learning use, will be penalized. Please be guided accordingly.
On January 02, 2020, Pedro Penduco started his locksmith business investing cash of P10,000.

Journal Entry:

DATE ACCOUNT TITLE DEBIT CREDIT

Jan 02, 2020 Cash P10,000
P. Penduco, Capital P10,000

GENERAL Ledger

CASH P. PENDUCO, CAPITAL

Dr. Cr. Dr. Cr.
2-Jan 10,000.00 10,000.00 2-Jan
Ending
Bal. 10,000.00 10,000.00 Ending Balance

Proceed to the Drill 1 portion of the module

The Trial Balance

https://slideplayer.com/slide/4507456/

Some Important Notes:

 Correct results of posting depend to a great extent on the correctness of the entries in the general
journal

 Errors in journalizing should be avoided as much as possible because any error in the journal entries
such as wrong amounts or wrong accounts debited and credited will lead to wrong results of posting

Proceed to Drill 2 of the module.

ACCT 1026 – Financial Accounting and Reporting | 4

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to others without permission from the University of Saint Louis. Unauthorized use of the
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Trial Balance out of balance if the total debits and total credits are not equal. This is a positive proof of the
existence of one or more errors.

The chief causes of errors are:

1. Posting an item to the wrong side of the account

2. A mistake in copying when transferring a balance from the ledger account to the trial balance.
3. Omission of the posting of either a debit or credit entry in the journal.
4. Posting the same item twice
5. Wrong addition or subtraction in finding the balance of an account.

Location of Errors

The following guides may help in the prompt location of errors:

 A difference of P0.01, P0.10, P1, P100, etc. suggests that an error has been made in addition or
subtraction

 A difference of 9 or a multiple of 9 indicates transposition, that is, the order of the figures is
reversed. For example, 25 is written as 52 or 38 is written as 83.

 A difference divisible by 2 indicates an error in posting to the wrong side of the account or entering
the account balance in the wrong column of the trial balance.

 A difference divisible by 9 or 99 indicates a slide or misplacement of a decimal point. For example,

P50 is written as P5.00.

Tip: If the trial balance is out of balance, a good plan to locate the error/s is to check the work
from the trial balance to the journal entries rather than from the journal entries to the trial balance.

Your thoughts!
If what is posted to the General Ledger is the record of the same transaction in the journal, why is
maintenance of the General Ledger still necessary? Don’t you think it is duplicative, time
consuming and boring?

ACCT 1026 – Financial Accounting and Reporting | 5

WARNING: No part of this E-module or LMS contentcan be reproduced or transported or shared

to others without permission from the University of Saint Louis. Unauthorized use of the
materials, other than personal learning use, will be penalized. Please be guided accordingly.
REFERENCES

Textbooks

1. Ballada, W. (2019). Basic Financial Accounting and Reporting. Manila: DomDane Publishers.
2. Cabrera, E.(2017) Fundamentals of Accounting Volume I, GIC Enterprises & Co., Inc., Manila
3. Millan, Z. V. (2020). Financial Accounting and Reporting (Fundamentals). Baguio City: Bandolin
Enterprise.
4. Valencia, E. and Roxas, G. (2017), Basic Accounting, Valencia Educational Supply
5. Valix, C. and Peralta, J. (2018). Financial Accounting Volume I GIC Enterprises & Co., Inc., Manila

Electronic Resource:
1. Accounting Basic https://www.accountingcoach.com/accounting-basics/explanation
2. Basic Accounting. https://www.bizfilings.com/toolkit/research-topics/finance/basic-accounting/the-
accounting-system-and-accounting-basics
3. Basic accounting and bookkeeping lessons, http://www.moneyinstructor.com/accounting.asp
4. Financial Accounting. https://www.accountingcoach.com/financial-accounting/explanation
5. Accounting Tutorials for Beginners. https://www.guru99.com/accounting.html
6. https://corporatefinanceinstitute.com/resources/knowledge/accounting/accounting-equation/
7. https://bobsteelecpa.com/accounting-equation-account-types-and-the-double-entry-accounting-
equation/
8. https://www.bookstime.com/what-is-the-accounting-equation
9. https://www.accountingcoach.com/blog/expanded-accounting-equation
10. https://accounting-simplified.com/equity.html
11. https://www.investopedia.com/
12. https://courses.lumenlearning.com/sac-finaccounting/chapter/the-basic-accounting-equation/

Assessment/Evaluation: Answers to this page is to be written in a separate sheet of paper.

DRILL 1: JOURNALIZING AND POSTING

The following were the transactions of Entity A during the period:

Date Transactions
Jan. 8 Services worth ₱150,000 were rendered for cash.
Jan. 9 Services worth ₱200,000 were rendered on account.
Jan. 10 Cash amounting to ₱25,000 was disbursed for advertising expense.
Jan. 11 Accounts receivable of ₱180,000 was collected.
Jan. 12 The owner made a temporary withdrawal of ₱10,000 cash from the business.

Requirements:
a. Provide the journal entries.
b. Post the journal entries to the ledger then determine the ending balances of the accounts. Use ledger
accounts for this purpose. Arrange the accounts in this order: Assets, Liabilities, Equity, Income and
Expenses.

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DRILL 2: JOURNALIZING, POSTING AND UNADJUSTED TRIAL BALANCE

Entity A started operation on January 1, 20x1. The following were the transactions during the first week of
operations:

Jan. Transactions
1 The owner provided ₱600,000 cash as initial investment to the business.
2 The business acquired a building for ₱400,000 cash.
3 The business acquired office equipment for ₱100,000 cash.
4 The business purchased supplies for ₱20,000 cash. The business uses a prepaid asset
account.
5 The business rendered services worth ₱150,000 on cash basis.
6 The business rendered services worth ₱100,000 on account.
7 The business paid ₱25,000 salaries expense.

Requirements:
a. Provide the journal entries.
b. Post the journal entries to the ledger. Arrange you’re the accounts in this order: Assets, Liabilities, Equity,
Income and Expenses.
c. Prepare the unadjusted trial balance.

ACCT 1026 – Financial Accounting and Reporting | 7

WARNING: No part of this E-module or LMS contentcan be reproduced or transported or shared

to others without permission from the University of Saint Louis. Unauthorized use of the
materials, other than personal learning use, will be penalized. Please be guided accordingly.