Ledger in financial accounting (11th commerce)

This presentation is on ledger which is the topic of financial accounting. it contents details about following points. There are:-
1. Meaning of ledger
2. Need & Importance of ledger
3. Advantage of Ledger
4. Difference b/w Journal & ledger
5. Format of ledger
6. Rules of posting
7. Illustrations
8. Exercise

1. CAREER POINT UNIVERSITY

2. Ledger

3. Acknowledgement I would like to express my special thanks of gratitude to my teacher (Pragya Bhargav Ma’am ( my mentor); Assistant professor ; school of commerce & management at career point university) who gave me the golden opportunity to do this wonderful project on the topic (Ledger in accountancy),which also helped me in doing a lot of Research and I came to know about so many new things I am really thankful to them. Secondly I would also like to thank my parents who helped me a lot in finalizing this project within the limited time frame.

4. Content Meaning of ledger Need & Importance of ledger Advantage of Ledger Difference b/w Journal & ledger Format of ledger Rules of posting Illustrations Exercise

5. Meaning of Ledger The books which contains a classified & permanent record of all transactions of a business is called “LEDGER”.

6. Need & Importance of Ledger It is important for knowing the balances of each account. It gives short information about each account. It is needed for making trial balance. I t helps in knowing how much amount is due from each customer and how much amount the firm has to pay to each supplier etc. A trading and profit & loss account can only be prepared with the help of ledger balances.

7. Advantage of ledger All accounts are opened on separate pages in this book. A trading and profit & loss account can only be prepared with the help of ledger balances. A balance sheet can also be prepared with the help of ledger balances which show the financial position of the business. Any type of information relating to the business can be easily obtained from the ledger.

8. Distinction b/w Journal & Ledger S. no. Basis Journal Ledger 1. Meaning Journal is a book of original entry in which the transaction are recorded first of all, as and when they take place . The books which contains a classified & permanent record of all transactions of a business is called ledger. 2. Full detail of transaction Recorded as narration. Not recorded. 3. Process of recording entries Named as Journalising. Named as Posting. 4. Accuracy Not tested. Tested by preparing Trial balance. 5. Order of recording Chronological order (datewise) Analytical order .

9. Format of Ledger Date Particulars J. F. Amount ₹ Date Particulars J.F. Amount ₹ Dr. Cr.

10. Rules of Posting All transaction relating to an account should be entered at one place. The word `To’ used before the accounts which appear on the debit side of an account. Similarly, the word `By’ used before the accounts which appear on the credit side of an account. It is not necessary to write the word ‘A/c’ after the personal accounts. Similar amount which has been posted on the debit side of an account should also be posted on the credit side of another account. If an account has been debited(or credited) in journal entry, should posted on debit(or credit)side of ledger. In particular column, the name of other account which has been credited(or debited) for journal entry should be written for reference.

11. Continue… Closing of personal account – the word ‘By balance c/d’ or ‘To balance c/d’ used for closing the personal account. Closing of real account - the word ‘By balance c/d’ or ‘To balance c/d’ used for closing the real account. Closing of nominal account – these accounts not require to be balancing.

12. Illustrations ENTER THIS WAY

13. Q 1. from the following journal entries . Prepare the ledger accounts :- Journal entries Date Particulars L.F. Dr. Amount ₹ Cr. Amount ₹ I Cash A/c Dr. To Sales A/c (Being goods sold for cash) 5,000 5,000 II Furniture A/c Dr. To Cash A/c (Being furniture purchased for cash) 10,000 10,000 III Purchases A/c Dr. To Govind (Being goods purchase on credit) 5,000 5,000 IV Purchases A/c Dr. To Cash A/c (Being goods purchase on cash) 7,000 7,000 V Mohan Dr. To Sales A/c (Being goods sold on credit) 15,000 15,000 VI Cash A/c Dr. To Interest A/c (Interest received ) 1,000 1,000

14. Sol…. Date Particulars J. F. Amount ₹ Date Particulars J. F. Amount ₹ To Sales A/c 5,000 By Furniture A/c 10,000 To Interest A/c 1,000 By purchase A/c 7,000 To balance c/d 11,000 17,000 17,000 Dr. Cash A/c Cr. Date Particulars J. F. Amount ₹ Date Particulars J. F. Amount ₹ By Cash A/c 5,000 By Mohan 15,000 Dr. Sales A/c Cr. Date Particulars J. F. Amount ₹ Date Particulars J.F. Amount ₹ To cash A/c 10,000 By balance c/d 10,000 10,000 10,000 Dr. Furniture A/c Cr.

15. Continue……. Date Particulars J.F. Amount ₹ Date Particulars J.F. Amount ₹ To Govind 5,000 To Cash A/c 7,000 Dr. Purchases A/c Cr. Date Particulars J.F. Amount ₹ Date Particulars J.F. Amount ₹ To balance c/d 5,000 By Purchases A/c 5,000 5,000 5,000 Dr. Govind’s A/c Cr. Date Particulars J.F. Amount ₹ Date Particulars J.F. Amount ₹ To Sales A/c 15,000 By balance c/d 15,000 15,000 15,000 Dr. Mohan’s A/c Cr.

16. Continue….. Date Particulars J.F. Amount ₹ Date Particulars J. F. Amount ₹ By Cash A/c 1,000 Dr. Interest A/c Cr. ₹

17. Q 2. Prepare the ledger accounts from the following entries :- Date Particulars L.F. Dr. Amount ₹ Cr. Amount ₹ 2017 Apr. 1 Cash A/c Dr. To Capital A/c (Being Ram started business with cash) 1,00,000 1,00,000 Apr.3 Furniture A/c Dr. To Cash A/c (Being furniture purchased for cash) 20,000 20,000 Apr. 8 Purchases A/c Dr. To Vishal To Cash A/c (Being purchase is made in cash & credit) 20,000 15,000 5,000 Apr.10 Cash A/c Dr. Sita A/c Dr. To Sales A/c (Being goods sold on cash or credit) 12,000 10,000 22,000 Apr.15 Drawings A/c Dr. To Cash A/c (Cash withdraw by proprietor for personal use.) 5,000 5,000

18. Sol….. Date Particulars J.F. Amount ₹ Date Particulars J.F. Amount ₹ 2017 Apr.1 To Capital A/c 1,00,000 2017 Apr.3 By Furniture A/c 20,000 Apr.10 To Sales A/c 12,000 Apr.8 By Purchases A/c 5,000 Apr.15 By Drawings A/c 5,000 Apr.30 By Balance c/d 82,000 1,12,000 1,12,000 Dr. Cash A/c Cr. Date Particulars J.F. Amount ₹ Date Particulars J.F. Amount ₹ 2017 Apr. 10 To balance c/d 1,00,000 2017 Apr.1 By Cash A/c 1,00,000 1,00,000 1,00,000 Dr. Capital A/c Cr.

19. Continue……. Date Particulars J.F. Amount ₹ Date Particulars J.F. Amount ₹ 2017 Apr.8 To Vishal 15,000 Apr.8 To Cash A/c 5,000 Dr. Furniture A/c Cr. Date Particulars J.F. Amount ₹ Date Particulars J.F. Amount ₹ 2017 Apr.3 To Cash A/c 20,000 2017 Apr.30 By balance c/d 20,000 20,000 20,000 Dr. Purchases A/c Cr. Date Particulars J. F. Amount ₹ Date Particulars J.F. Amount ₹ 2017 Apr.8 To balance c/d 15,000 2017 Apr.30 By purchases 15,000 15,000 15,000 Dr. Vishal’s A/c Cr.

20. Continue……. Date Particulars J.F. Amount ₹ Date Particulars J.F. Amount ₹ 2017 Apr.10 To sales A/c 10,000 2017 Apr.30 By Balance c/d 10,000 10,000 10,000 Dr. Sita’s A/c Cr. Date Particulars J.F. Amount ₹ Date Particulars J.F. Amount ₹ 2017 Apr.10 By Cash A/c 12,000 Apr.10 By Sita 10,000 22,000 22,000 Dr. S ales A/c Cr. Date Particulars J.F. Amount ₹ Date Particulars J.F. Amount ₹ 2017 Apr.15 To cash A/c 5,000 2017 Apr.30 By balance c/d 5,000 5,000 5,000 Dr. Drawings A/c Cr.

21. Exercise

22. Q 1 . Prepare the ledger accounts from the following entries :- Date Particulars L.F. Dr. Amount ₹ Cr. Amount ₹ 2015 Apr. 1 Cash A/c Dr. To Capital A/c (Being Ram started business with cash) 5,00,000 5,00,000 Apr.3 Plant A/c Dr. To Cash A/c (Being plant purchased for cash) 2,00,000 2,00,000 Apr. 8 Purchases A/c Dr. To Mohan To Cash A/c (Being purchase is made in cash & credit) 50,000 30,000 20,000 Apr.10 Cash A/c Dr. Geeta Dr. To Sales A/c (Being goods sold on cash or credit) 80,000 20,000 1,00,000 Apr.15 Drawings A/c Dr. To purchases A/c (Cash withdraw by proprietor for personal use.) 22,000 22,000

23. Q 2. Prepare the ledger accounts from the following entries :- Date Amount ₹ Jan.1 Goods sold to Manish 1,00,000 Jan.2 Goods purchased from Mahesh 50,000 Jan.2 Furniture purchased 10,000 Jan.3 Plant sold 2,00,000 Jan.5 Land purchased 5,00,000 Jan.7 Rent paid by cheque 20,000 Jan.10 Cash received from Manish (sale on Jan.1) in full settlement 90,000 Jan.15 Cash paid to Mahesh (discount received ₹ 500) 49,500 Jan.16 Rent received 10,000 Jan.17 Drew for personal use 20,000 Note :- first prepare journal then make ledger accounts .

24. Thank You

25. Presented by :- Y amini Kahaliya BBA(Honors’)