1. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning Chapter 11 Objectives 1.Define accounting terms related to posting to ledgers. 2.Identify accounting practices related to posting to ledgers. 3.Post separate items from a purchases, cash payments, and general journal to an accounts payable ledger. 1 LESSON 11-1

2. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning Chapter 11 Objectives 4.Post separate items from a sales, cash receipts, and general journal to an accounts receivable ledger. 5.Post separate items from a cash payments and general journal to a general ledger. 2 LESSON 11-1

3. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning Chapter 11 Objectives 6.Post special journal column totals to a general ledger. 7.Journalize and post correcting entries affecting customer accounts. 3 LESSON 11-1

4. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 11-1 Posting to an Accounts Payable Ledger

5. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning Posting Posting—Transferring information FROM a journal entry TO a ledger account FIVE Steps of Posting TO the Ledger 1. Write the Date from Source 2. Write the Page Number of the Source 3. Write the Debit OR Credit amount FROM Source 4. Update the Balance of the Ledger Account 5. Write the Acct. Number in the Post Ref of Source 5 LESSON 4-2

6. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning Accounting Terms General Ledger (See Page 231 full list) BALANCE SHEET ACCOUNTS (1000) Assets (2000) Liabilities (3000) Stockholders’ Equity INCOME STATEMENT ACCOUNTS (4000) Operating Revenue (5000) Cost of Merchandise (6000) Operating Expenses 6 LESSON 11-1

7. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning Accounting Terms Subsidiary Ledgers—a ledger that is summarized in a single general ledger account. Examples: Accounts Payable Ledger—a subsidiary ledger containing only accounts for vendors from whom merchandise or other items are purchased on account. (Who WE bought FROM) Accounts Receivable Ledger—a subsidiary ledger containing only accounts for charge customers who bought on account (Who WE sold to 7 LESSON 11-1

8. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning Accounting Terms Controlling Accounts—an account in a general ledger that summarizes ALL accounts in a subsidiary ledger. The balance of a Controlling Account EQUALS the total of ALL account balances in its related subsidiary ledger. Example: Accounts Payable(2110) = ALL AP Ledgers Accounts Receivable(1130)= ALL AR Ledgers 8 LESSON 11-1

9. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 9 LESSON 11-1 ACCOUNTS PAYABLE LEDGER AND GENERAL LEDGER CONTROLLING ACCOUNT page 299 Green in Book Yellow in Book

10. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 10 LESSON 11-1 ACCOUNTS PAYABLE LEDGER FORMS 12 3456 page 300 1.Write the vendor name. 2.Write the vendor number. 3.Write the date. 4.Write the word Balance. 5.Place a check mark in the Post. Ref. column. 6.Write the balance. 7.Accounts Payable Ledgers ONLY have CREDIT balance columns Yellow in Book

11. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning Rules for Balances 1.When the previous balance was a Debit and the new number is ALSO a debit, ADD to get a larger debit 2.When the previous balance was a Credit and the new number is ALSO a credit, ADD to get a larger credit When the same always ADD!!!! LESSON 4-2 11

12. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning Rules for Balances 1.When the previous balance was a Debit and the new number is a Credit, SUBTRACT to get a smaller debit 2.When the previous balance was a Credit and the new number is a debit, SUBTRACT to get a smaller credit When different always SUBTRACT!!!! LESSON 4-2 12

13. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 13 LESSON 11-1 POSTING FROM A PURCHASES JOURNAL TO AN ACCOUNTS PAYABLE LEDGER page 301 1.Write the date. 2.Write the journal page number. 3.Write the credit amount. 4.Write the new account balance. 5.Write the vendor number. 1 2 3 4 5 Peach in Book Yellow in Book

14. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 14 LESSON 11-1 POSTING FROM A CASH PAYMENTS JOURNAL TO AN ACCOUNTS PAYABLE LEDGER page 302 4.Subtract the amount in the Debit column from the previous balance in the Credit column. Write the new balance. 1.Write the date. 5.Write the vendor number. 2.Write the journal page number. 3.Write the debit amount. 1 2 3 4 5 Peach in Book Yellow in Book

15. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 15 LESSON 11-1 POSTING A CREDIT ENTRY FROM A GENERAL JOURNAL TO AN ACCOUNTS PAYABLE LEDGER page 303 1.Write the date. 2.Write the general journal page number. 3.Write the amount. 4.Add the amount in the Credit column to the previous balance in the Credit Balance column. Write the new balance. 5.Write the vendor number. 1 3 5 4 2 Peach in Book Yellow in Book

16. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 16 LESSON 11-1 POSTING A DEBIT ENTRY FROM A GENERAL JOURNAL TO AN ACCOUNTS PAYABLE LEDGER page 303 1.Write the date. 2.Write the general journal page number. 3.Write the amount. 4.Add the amount in the Debit column to the previous balance in the Debit Balance column. Write the new balance. 5.Write the vendor number. 1 4 2 5 3 Peach in Book Yellow in Book

17. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 17 LESSON 11-1 COMPLETED ACCOUNTS PAYABLE LEDGER page 304 Yellow in Book

18. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 18 LESSON 11-1 PROVING THE ACCOUNTS PAYABLE LEDGER page 305 Schedule of Accounts Payable—a listing of vendor accounts, account balances, and total amount DUE TO ALL our vendors

19. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 19 LESSON 11-1 TERMS REVIEW subsidiary ledger accounts payable ledger accounts receivable ledger controlling account schedule of accounts payable page 306

20. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning Audit Your Understanding 1.What is the relationship between a controlling account and a subsidiary ledger? 2.In which column of the cash payments journal are the amounts that are posted individually to the AP ledger? 20 LESSON 11-1