Journal, Ledger &

Trial Balance
The Accounting Cycle/Process
1. Journalize Transactions
2. Post Each Journal Entry to Appropriate Ledger Account
3. Prepare Trial Balance

4. Making Adjustments
5. Preparing Adjusted Trial Balance
6. Preparing Financial Statements
7. Journalizing and Posting Closing Entries
8. Prepare After-Closing Trial Balance
The Journal, Ledger, Trial Balance
 The Journal, Ledger, Trial Balance
• Initial record of each and every business transaction.

• It is a chronological record of entries.

• Information from Journal is then posted into appropriate ledger accounts

• ALWAYS REMEMBER DEBIT/CREDIT RULES

Debit and Credit Rules

1. Assets - - - - - - - - - Inc-Dr. Dec-Cr.

Inc-Cr. Dec. Dr.
2. Liabilities - - - - - - -
Inc-Cr. Dec. Dr.
3. Owner’s Equity - -
Always Cr.
4. Revenue - - - - - - -
Always Dr.
5. Expense - - - - - - -
 General Journal
Date Particulars L . F Debit Credit
 General Journal
Date Particulars L . F Debit Credit
20 Debit Entry XXXXXX
Jan Credit Entry XXXXX
(Description of the transaction)
 The Journal, Ledger, Trial Balance
Jan 20 – ABC started business by investing 80,000.
Jan 21 – Purchased land for 52,000 paying cash.
Jan 22 - Purchased building for 36,000, paying 6,000 in cash and issuing a
note of 30,000
Jan 23 – Purchased tools and equipment on account 13,800
Jan 24 – Sold some of the tools for to their cost 1,800 to collect in 45 days.
Jan 26 – Received 600 in partial collection of tools (sold on 24 Jan)
Jan 27 – Paid 6,800 in partial payment of an account payable.
Jan 30 - Received 2,200 of sales revenue in cash.
Jan 31 – Paid 1,400 expense, 200 utilities and 1,200 wages.
 Feb 1 - XYZ invested 500,00 cash in business in exchange for 2500 shares.
Feb 10 - Purchased office facilities for 300,000, of which 100,00 was applicable
. to land and 200,000 to the building.
Feb 16 - Computer equipment was purchased from Pcworld for 12,000 cash.
Feb 18 - Furnishing were purchased at a cost of 9’000. A 1,000 cash payment
. was made and a contract was made for the rest in 2 installments.
Feb 22 - Office supplies were purchased for 300 cash.
Feb 23 - XYZ discovered that it paid too much for a printer from Pcworld on 16
. Feb. It should have cost only 359, but XYZ was charged 395. Pcworld
promised to refund the different within 7 days.
Feb 27 - First installment due on the account payable for office furnishing
purchased on 18 Feb.
Received 36 from Pcworld in full settlement of the account receivable
Feb 28 - created on February 23.