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    SNM Ledger - Unit 1 CH IV

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    devika12579

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    SNM Ledger - Unit 1 CH IV

    Uploaded by

    devika12579
    39 views9 pages

    Original Title

    SNM Ledger - Unit 1 Ch IV

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    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    39 views9 pages

    SNM Ledger - Unit 1 CH IV

    Uploaded by

    devika12579

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    of 9

    Ledger Posting and Trial Balance

    Chapter Four

    Introduction

    Ledger

    It is a book which contains various Accounts Real, Personal, Nominal


    Bound Ledger Loose Leaf Ledger

    Posting

    It means transferring the debit and credit items to the Ledger. All entries are first recorded in Journal. Then they are posted on to the Ledger. Example on page 1.59 Illustration 4.2 on page 1.60

    Trial Balance

    It is a statement containing the various ledger balances on a particular date. Illustration 4.2 on page 1.60 Purpose:

    Checking of the arithmetical accuracy. Basis of Financial statements. Summarized ledger.

    Methods of preparing Trial Balance

    Totals method: Total of debit and credit are shown in the Trial balance. Balance method: Balance of the ledger account are shown in the respective debit and credit columns of the Trial balance. Illustration 4.3 on page 1.64

    VOUCHER SYSTEM

    Voucher means a documentary evidence in support of a business transaction. Supportings: Receipt, Bill, Invoice etc. A Voucher is prepared for each item of expenditure to be properly authorized.

    Advantages of Voucher System


    Safeguards cash disbursements Reduces book-keeping work Recording of all current liabilities Strengthening of internal check system Planning future cash requirements

    Limitations of Voucher System


    Unsuitable for small concerns Proper personnel and finances required Does not provide overall Creditors system. Difficulties in case of Partial payments, Returns etc.

    Assignment

    Practical problems 1 to 5.

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