CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

POSTING TO GENERAL AND POSTING TO GENERAL AND SUBSIDARY LEDGERSSUBSIDARY LEDGERS

Posting to an Accounts Payable Ledger

Slides are on the class website!

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

GENERAL AND SUBSIDARY LEDGERSGENERAL AND SUBSIDARY LEDGERS

Just like with the various special journals we used for our merchandising business, due to the nature and complexity of the business’s operations.

Which are?

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LESSON 11-1

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

GENERAL AND SUBSIDARY LEDGERSGENERAL AND SUBSIDARY LEDGERS

Purchase Journal Cash Payments Journal Sales Journal Cash Receipts Journal General Journal

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LESSON 11-1

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

GENERAL AND SUBSIDARY LEDGERSGENERAL AND SUBSIDARY LEDGERS

Just like with special journals a business’s size and number of transactions, and type of transactions determine the number and kinds of ledgers used in an accounting system.

Remember a ledger is just another name for an account. Each account has its own ledger.

Lets look at an example of a General Ledger on page 231 of the text book.

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LESSON 11-1

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

GENERAL AND SUBSIDARY LEDGERS GENERAL AND SUBSIDARY LEDGERS

There are a lot of accounts!

What do you notice about the Accounts Payable Ledger?

Don’t we not have a lot of different vendors who we purchase merchandise from?

So why is there only one Accounts Payable Ledger account?

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LESSON 11-1

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

GENERAL AND SUBSIDARY LEDGERSGENERAL AND SUBSIDARY LEDGERS

Just like in math, in Accounting we try to simplify things to make record keeping more orderly.

Since we do business with so many different vendors it would be problematic to keep track of all vendors in one Accounts Payable Ledger account.

Therefore we utilize a special Accounts Payable Ledger.

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LESSON 11-1

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

GENERAL AND SUBSIDARY LEDGERSGENERAL AND SUBSIDARY LEDGERS

The Accounts Payable Ledger then can be thought of as the General Ledger for Accounts Payable.

With in the Accounts Payable Ledger there are Subsidiary Ledgers that track the business activities of their respective vendors.

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LESSON 11-1

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

GENERAL AND SUBSIDIARY LEDGERSGENERAL AND SUBSIDIARY LEDGERS

When we conduct Posting activities, postings are made to the respective Accounts Payable Ledger’s Subsidiary Ledgers.

Then the ending balances of the Subsidiary Ledgers are then transferred to the Controlling Account of the Accounts Payable Ledger.

Quite A Lot!

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LESSON 11-1

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

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LESSON 11-1

A PICTURE IS WORTH A THOUSAND WORDSA PICTURE IS WORTH A THOUSAND WORDS page 299

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

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LESSON 11-1

ACCOUNTS PAYABLE LEDGER FORMSACCOUNTS PAYABLE LEDGER FORMS page 300

What is different about this ledger?

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

POSTING PROCEDURESPOSTING PROCEDURES

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LESSON 11-1

The posting procedures from the various special journals to the accounts in the Accounts Payable Ledger are no different.

The Journals we will be posting from are the

Purchase JournalCash Payments JournalGeneral Journal

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

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LESSON 11-1

GENERAL POSTING PROCEDURESGENERAL POSTING PROCEDURES 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.

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

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LESSON 11-1

COMPLETED ACCOUNTS PAYABLE COMPLETED ACCOUNTS PAYABLE LEDGERLEDGER page 304

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

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LESSON 11-1

PROVING THE ACCOUNTS PAYABLE PROVING THE ACCOUNTS PAYABLE LEDGERLEDGER page 305