Ledgers are books
of accounts used for reporting economic transactions measured in monetary
terms. Each financial transaction is
noted inside a ledger. It depends on the size and structure of the organisation
that the number of journal entries vary from hundreds to millions.
General ledger
accounts are basically nothing but chart of accounts.
It helps in
consolidating journal entries at a single place which are of same nature. Transfer
of several journal entries in a single ledger account is termed as posting. For
example, 100 entries of journal passed can be posted into a single sales
account created. Post that, several sales transactions can be noted in that
account date-wise.
Boundless helps
you in doing this and maintaining ledgers all the while for your business.
Some important
points that relate to ledger are:
1. Each side of a journal entry is made on the
same side of the ledger i.e. debit entry is made on the debit side while credit
entry is made on the credit side.
2. Expenses and
assets represent debit balance while income and liabilities represent credit
balance including capital balance.
3. Debit balance
in the statement represents amounts receivable while credit balance in the
statement represents amounts payable. While amount receivables are noted in
assets, amount payables are represented in liabilities.
4. While credit
side represents income earned, debit side represents an organisation's
expenses.
5. A cash book's
debit balance means cash in hand.
6. Bank book's
debit side is balance at bank and bank book's credit balance is bank overdraft.
7. However, real
and personal account balances are represented in balance sheet and are carried
onto next financial years.
For more on ledger services
and related, call us at +91-11-66797769 or e-mail at info@boundlessindia.comor visit us at http://www.boundlessindia.com.
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