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Posting
Posting
Definition: Posting is the act of moving debit and credit account balances from
Basic Accounting Course
individual journals to their corresponding ledgers. These ledgers are later used to Financial Accounting Basics
create a trial balance used to generate the income statement, balance sheet, and Accounting Principles
other financial statements. Accounting Cycle
Financial Statements
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What Does Posting Financial Ratio
Mean?
What is the definition of posting? In
this step of the accounting cycle an
accountant takes total credits and debits
recorded in categorized sub-ledgers and
posts them into the general ledger to be
used for official accounting statements.
This sounds like a lot of work, but it’s necessary to keep an accurate record of
business events. You can think of this like categorizing events into specific and
broader relevant groupings. For example, journals are transferred to subsidiary
ledgers then transferred to the general ledger.
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Example
Let’s say a company has $3,000 worth of rent expenses per month that needs to be
posted for the annual general ledger. A subsidiary ledger would contain details of the
rent expenses, including a line item per month debited in “Rent” and credited in
“Accounts Payable”.
At the end of the accounting period, these items would be consolidated and posted
into one line item in the general ledger. This way all of the information is included for
the time period in the general ledger, but if there is a question about any month in
particular it is possible to go back into the subsidiary ledger and see additional details.
Summary Definition
Define Posting: Posting means the step in the accounting cycle where balances
from journal accounts are transferred to ledger accounts.
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