2. Financial Accounting 1 Lecture – 07 Recap of Lecture 06 An overview of the flow of transactions. An introduction to the basic books of accounts. The General Ledger

3. Financial Accounting 2 Lecture – 07 Areas Covered in this Lecture Cash Book and Bank Book; The term of Accounting period Trial Balance The uses and limitations of trial balance

4. Financial Accounting 3 Lecture – 07 Flow Of Transactions / Recording of Transactions General Journal Trial Balance Profit & Loss AccountBalance Sheet The Voucher Occurrence of an Event General Ledger Cash/Bank Book

5. Financial Accounting 4 Lecture – 07 The Cash Book The Cash Book records all the movements in the cash account.

6. Financial Accounting 5 Lecture – 07 The Cash Book Cash BookAccount Code 01 DateVoucher Number Narration / Particulars Ledger Code Receipt Amount Payment Amount Balance Dr/(Cr) Cash BookAccount Code 01 Receipt SidePayment Side DateNo.Narration / Particulars Ledger Code Receipt Amount DateNo.Narration / Particulars Ledger Code Payment Amount OR

7. Financial Accounting 6 Lecture – 07 The Bank Book The Bank book records all the movements in the bank account.

8. Financial Accounting 7 Lecture – 07 The Bank Book Bank Book (Bank Account Number)Account Code 02 DateVoucher Number Chq. No. Narration / Particulars Ledger Code Receipt Amount Payment Amount Balance Dr/(Cr)

9. Financial Accounting 8 Lecture – 07 The Ledger Balance (Debit Balance) 10,000Balance 110,000120,000 4 3 20,000 100,000 30,0002 180,000 Title of AccountAccount Code 01 No.Narration / Particulars Date Credit Side Receipt Amount No.Narration / Particulars Payment Amount Date Debit Side A Debit Balance

10. Financial Accounting 9 Lecture – 07 The Ledger Balance (Credit Balance) 10,000Balance 120,000110,000 4 3 30,000 80,000 20,0002 1100,000 Title of AccountAccount Code 01 No.Narration / Particulars Date Credit Side Receipt Amount No.Narration / Particulars Payment Amount Date Debit Side A Credit Balance

11. Financial Accounting 10 Lecture – 07 An Accounting Period Accounting period is any period for which a profit and loss account is prepared. The length of the accounting period can be anything between one day to one year The legal or statutory definition is a maximum of one year.

12. Financial Accounting 11 Lecture – 07 Financial Year “A Period of 12 Months Duration”. (1 st of July to 30 th June) Except for specialized business e.g. Textile, Banks.

13. Financial Accounting 12 Lecture – 07 The Trial Balance A sheet that balances of all accounts

14. Financial Accounting 13 Lecture – 07 A Sample Trial Balance Name Of The Organization Trial Balance As On (Date on Which Trial Balance is Drawn) Title of AccountAccount Code Debit Amount Credit Amount Cash in Hand Cash at bank Capital Assets Liabilities Income Expenses 01 02 03 04 05 06 07 xy Totalxyz