Essay About Sales Transactions And Transaction Dates

Determining Account Balances
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Once transactions have been analyzed and recorded in a journal, it is necessary to classify and
group all similar items. This is accomplished by the bookkeeping procedure of posting all the
journal entries to appropriate accounts. As indicated earlier, accounts are records of like items.
They show transaction dates, increases and decreases, and balances. For example, all increases and
decreases in cash arising from transactions recorded in the journal are accumulated in one account
called Cash. Similarly, all sales transactions are grouped together in the sales revenue account.
Posting is no more than sorting all journal entry amounts by account and copying those
amounts to the appropriate account. No analysis is needed; all the necessary analysis is performed
when the transaction is first recorded in the journal.
All accounts are maintained in an accounting record called the “general ledger.” A ledger
is a “book of accounts.” Exhibit 6 shows how the three cash transactions in the general journal
would be posted to the cash account in the general ledger, with arrows depicting