Accounting·Basic accounting systems · NSSCO 1.4
The ledger & balancing T-accounts
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Every debit and credit we learned about has to live somewhere — and that somewhere is the ledger, the book of accounts. In this lesson we meet the ledger and its three sections, post real transactions into T-accounts, and then master the big skill: balancing an account step by careful step, with the proper Balance c/d and Balance b/d wording. We finish by reading what a balance means and by laying the same account out in the neat three-column running-balance format.
What you'll learn in this lesson
By the end you should be able to (NSSCO Accounting 1.4):
- Explain the ledger and its importance
- Record transactions using the double entry system (for capital, drawings, assets, liabilities, income, expenses)
- Explain the division of the ledger into specialist areas (Debtors, Creditors, General)
- Record transactions in the General Ledger in the traditional (T-account) and debtors' and creditors' individual accounts in running balance (3-column) format
- Balance T-accounts in the ledger
- Explain the meaning of a balance on a ledger account
- Interpret all ledger accounts
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