Rules Regarding posting

Rules Regarding posting: The balances in subledgers and the general journal are transferred into the general ledger during posting in accounting. The whole balance in a subledger is transferred to the general ledger when posting, not the individual transactions in the subledger. An accounting manager may choose to submit data rarely, such as once a month, or more regularly, such as once a day.

Subledgers are only utilised when a certain accounting area, such as inventories, accounts payable, or sales, has a high amount of transaction activity. As a result, posting is only applicable in certain high-volume scenarios. There are no subledgers and hence no requirement for posting in low-volume transaction conditions since entries are made directly into the main ledger.

For example, ABC International sends 20 invoices to its clients over the course of a week, with total sales of $300,000 in the sales subledger. ABC’s controller enters a posting entry with a $300,000 debit to the accounts receivable account and a $300,000 credit to the revenue account to shift the sum of these sales into the general ledger.

When a parent business keeps separate sets of books for each of its subsidiary companies, posting is also employed. Because each subsidiary’s accounting records are virtually the same as subledgers in this scenario, the account totals from the subsidiaries are recorded into the parent company’s. A manual consolidation operation may also be performed on a separate spreadsheet.

In certain accounting systems that do not employ subledgers, posting has been discontinued. Instead, all data is saved directly in the accounts mentioned in the general ledger.

When posting is used, someone looking for information in the general ledger must “drill down” from the account totals posted into the appropriate general ledger accounts and look for details in the applicable subledgers. This may need a substantial amount of extra investigation.

Rules Regarding posting: Posting is one of the essential procedural processes necessary before financial statements can be generated from the standpoint of closing the books. All adjustment entries to the different subledgers and general journal must be made during this phase, and their contents must then be posted to the general ledger. It is typical to put a lock-out flag in the accounting software at this point, preventing any further modifications to the subledgers and journals for the accounting period in question. The following accounting period’s access to the subledgers and journals is then granted.

The totals in the general ledger, as well as the financial statements derived from the general ledger, will not be accurate if posting is not done correctly as part of the closing procedure. Important Rules Regarding posting

Rules Regarding posting

How to Balance a Ledger Account in Steps

Rules Regarding posting: To prevent errors, compute the totals of the debit and credit columns individually on a rough page. Subtract the lower from the higher to get the difference between the heavier and lighter totals. A balance amount is the difference between the two amounts.

If the debit side’s total exceeds the credit side’s total, the balance is referred to as a “Debit Balance,” and it is recorded on the account’s credit side (the side with the smaller amount) as “By Balance c/d” or “By Balance c/FD.” c/d denotes carried down, whereas c/FD denotes carried forward.

Similarly, if the credit side total exceeds the debit side total, the amount is referred to as “Credit Balance.” The difference is stated as “To balance c/d” or “To balance c/fd” on the debit side of the account. The heavier total should be entered in both columns’ totals once we get it. Draw two lines across the total under the amounts, indicating that the account is closed and balanced.

The current year’s beginning balance is the same as the previous year’s ending balance. If there is a debit, it should be represented as “To Balance b/d” or “To Balance b/fd” on the debit side of a given account. B/d stands for brought down, while b/fd stands for brought forward. The balances in the nominal accounts are moved to the profit and loss account.

Posting the entries from the day books to the ledger is a crucial task. While posting entries, an accountant must keep the following rules in mind:-

• Only entries from the day books or journals may be uploaded.
• The entries must be organised by date.

The date of entry in the ledger must match the date of entry in the day books.

Rules Regarding posting: All debit side amounts in a journal must be sent to the debit side of a specific account. The name of the other account as stated in the journal, referring to the same entry, must be entered in the ‘particulars’ column of the ledger, and the account head must begin with ‘To’.

All credit side amounts in a journal must be submitted to the credit side of a specific account. The name of the other account as stated in the journal, referring to the same entry, must be recorded in the ‘particulars’ column of the ledger, and the account head must begin with ‘By’.

Following the entry, the page number of the journal from which the entry was made must be recorded in the L/F column of the account, as well as the page number of the ledger account in the L/F column of the journal or day book.

After then, the ledger should be balanced. Balancing may be done while the system is operating or after the debit and credit side totals have been completed. If the total of the debit side exceeds the total of the credit side, the balance should be presented in the balance column as a debit balance, and if the total of the credit side exceeds the total of the debit side, the balance should be shown in the balance column as a credit balance. If the totals on the debit and credit sides are identical, the balance in the balance column should be ‘zero.’