“Keeping the books of accounts” is a simple phrase that means maintaining an accounting book. The transactions are first recorded in the journal in chronological order of date with explanations after their occurrence. But it is not possible to determine the complete results of transactions from the journal. In other words, it is not possible to find out the profit earned under which head or how many assets and liabilities are there in the business.
To know this, all the transactions are recorded under different heads of accounts. So, the ledger is one of the accounting books in which all the transactions particular to an account are given.
If a student has given an accounting assignment where he has to prepare the financial account, then ledger will also be included in it. But many students often make mistakes when preparing a ledger like writing the wrong amount, writing the debit amount into credit, not making proper format, etc. So, to prepare an accounting ledger without any mistake, here are some easy tips are given by accounting assignment help experts of Assignment Prime.
Follow These Steps and Prepare a Proper Accounting Ledger
lTip 1- Drawing the Format
Every ledger account is divided into two equal parts separated by a bold vertical line. The left side of the account is the debit side and the right side is the credit side. Both the sides of the account are divided into four columns. The left four columns for the debit side and the right four columns for the credit side.
In the columns, we write-
1st column- Date
2nd column- Particulars
3rd column- Journal Folio
4th column- Amount
Tip 2- Posting Transactions to Respective Ledger Accounts
When we transfer the account from journal to ledger, it is called posting. It is often seen that students make mistakes when posting transactions in the respective account they are associated with. They sometimes forget writing the date. The common mistake made by most of the students is writing the amount at the wrong place. So, to avoid this mistake, the credit and the debit amount of the debit side is to be written in the respective columns and the same goes with the credit side.
Tip 3- Putting the Correct Page Number in the Folio Column
The page number from where the journal entries are transferred to the ledger account is known as the journal folio. Writing the right page number properly in the folio column is important because if the reader wants to see the journal entry associated with the ledger account, he can see it easily. The main advantage is that the reader does not have to go through the complete journal to find out the account.
Tip 4- Separating the Debit and Credit Accounts
The debit and credit accounts in each ledger are totaled separately at both sides. This is known as casting. The debit account and the credit account columns should be calculated separately and each of the account totals should be done correctly and then written in the total column of the account.
Tip 5- Balancing the Accounts
After the totaling of debit and credit side of both the accounts, it should be equal at both the sides by balancing the accounts. To balance the account, the difference after totaling the accounts is to be added to the deficit side.
So, balancing is adding the credit balance to the debit side and adding the credit balance to the credit side.
These are some of the tips to be kept in mind when preparing an accounting ledger.
Now as you know all the important tips, understand each tip carefully and begin with the assignment writing task to impress your professor.
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