Advertisements
Advertisements
Question
Explain the procedure for balancing a ledger account.
Advertisements
Solution
Following is the procedure for balancing an account:
- The debit and credit columns of an account are to be totaled separately.
- The difference between the two totaled is to be ascertained.
- The difference is to be placed in the amount column of the side having a lesser total. ‘Balance c/d’ is to be entered in the particulars column against the difference and in the date column, the last day of the accounting period is entered.
-
Now both the debit and credit columns are to be totaled and the totals will be equal. The totals of both sides are to be recorded in the same line horizontally. The total is to be distinguished from other figures by drawing lines above and below the amount.
- The difference has to be brought down to the opposite side below the total. ‘Balance b/d’ is to be entered in the particulars column against the difference brought down and in the date column, the first day of the next accounting period is entered.
- If the total on the debit side of an account is higher, the balancing figure is debit balance and if the credit side of an account has a higher total, the balancing figure is a credit balance. If the two sides are equal, that account will show nil balance.
APPEARS IN
RELATED QUESTIONS
Write the word, term, phrase, which can substitute the statement.
A debit balance to personal Accounts.
Write the word, term, phrase, which can substitute the statement.
A credit balance to bank Account.
Select appropriate alternatives from those given below and rewrite the sentence.
Real account always shows ____________ balance.
Select appropriate alternatives from those given below and rewrite the sentence.
_____________ is prepared to test arithmetical accuracy of Books of Accounts.
Complete the following table:
| Land & Building | Real Account |
| Commission Received | ? |
The process of finding the net amount from the totals of debit and credit columns in a ledger is known as ____________.
Prepare Furniture A/c from the following transactions.
| 2016 Jan | Particulars | ₹ |
| 1 | Furniture in hand | 2,000 |
| 1 | Purchased furniture for cash | 4,000 |
| 30 | Sold furniture | 400 |
Give journal entries and post them to cash account.
| 2016 June | Particulars | ₹ |
| 1 | Commenced business with cash | 1,10,000 |
| 10 | Introduced additional capital | 50,000 |
| 28 | Withdrawn for personal use | 20,000 |
Enter the following transactions in the books of Ganesan and post them into ledger.
| 2017 Oct | Particulars | ₹ |
| 1 | Started business with cash | 25,000 |
| 5 | Deposited into bank | 12,500 |
| 10 | Purchased furniture and payment by cheque | 2,000 |
| 15 | Goods purchased for cash | 5,000 |
| 19 | Sold goods to Vasu on credit | 4,000 |
| 22 | Goods worth has taken for personal use | 500 |
Prepare Anand’s account from the following details.
| 2017 July | Particulars | ₹ |
| 1 | Credit balance of Anand’s A/c | 4,000 |
| 15 | Amount paid to Anand | 2,000 |
| 18 | Goods purchased from Anand on credit | 8,000 |
| 20 | Paid to Anand | 3,960 |
| Discount allowed by him | 40 | |
| 25 | Goods purchased from Anand | 5,000 |
