How to Use This Page
Solve each Samacheer Kalvi exercise question on your own first, then compare your format and answer. Ledger posting and balancing are core skills — practise the T-shaped account format until you can post and balance without referring to examples.
Key Concepts (Quick Recap)
What is a Ledger?
A ledger is the principal book of accounts that contains all the accounts of a business. After transactions are recorded in the journal (or subsidiary books), they are posted to the ledger to classify them under each account.
Ledger Account Format (T-shape)
Dr. [Account Name] Cr.
Date | Particulars | J.F. | Amount | Date | Particulars | J.F. | Amount
-----|-------------|------|--------|------|-------------|------|-------
| | | | | | |
- Debit side (Dr): Left side — records all debit entries
- Credit side (Cr): Right side — records all credit entries
Rules for Posting
| Account Type | Debit Side | Credit Side |
|---|
| Personal | Receiver | Giver |
| Real | What comes in | What goes out |
| Nominal | Expenses and losses | Incomes and gains |
Posting from Journal
1. Identify the debit account and credit account in the journal entry 2. Post the debit account on the debit side of that account (with credit account name in particulars) 3. Post the credit account on the credit side of that account (with debit account name in particulars) 4. Enter the journal folio (J.F.) number in both accounts
Balancing a Ledger Account
1. Total the debit side and credit side separately 2. Find the difference between the two totals 3. If debit total > credit total → Debit balance (insert the difference on the credit side as "Balance c/d") 4. If credit total > debit total → Credit balance (insert the difference on the debit side as "Balance c/d") 5. Draw double lines below the totals 6. Bring the balance forward: "Balance b/d" on the opposite side at the start of the next period
Types of Balances
- Debit balance: When debit side total exceeds credit side. Common for: assets, expenses, losses
- Credit balance: When credit side total exceeds debit side. Common for: liabilities, incomes, gains, capital
Important Points
- Cash account always has a debit balance (or nil balance — never a credit balance, because you cannot pay more cash than you have)
- Personal accounts can have either a debit balance (debtor) or credit balance (creditor)
- Nominal accounts are not balanced — they are transferred to P&L Account at the end of the year
- Real accounts are balanced and shown in the Balance Sheet
I. Choose the Best Answer (MCQs)
Q1. Ledger is a book of (a) Original entry (b) Final entry (or secondary entry) (c) Supplementary entry (d) None of these
Answer(b) Final entry (or secondary entry) — The ledger is the book of final entry where transactions are classified account-wise after being recorded in the journal (book of original entry).
Q2. The process of transferring entries from journal to ledger is called (a) Journalising (b) Posting (c) Balancing (d) Summarising
Answer(b) Posting — Posting is the process of transferring the debit and credit entries from the journal to the respective ledger accounts.
Q3. If the debit side total exceeds the credit side total, the account has a (a) Credit balance (b) Debit balance (c) Nil balance (d) Cannot be determined
Answer(b) Debit balance — When the total of the debit side is more than the credit side, the difference is a debit balance. This is common for asset accounts.
Q4. Cash account always has a (a) Credit balance (b) Debit balance (c) Either debit or credit balance (d) No balance
Answer(b) Debit balance — Cash account always has a debit balance (or nil balance) because a business cannot pay more cash than it receives.
Q5. Personal accounts can have (a) Only debit balance (b) Only credit balance (c) Both debit and credit balance (d) No balance
Answer(c) Both debit and credit balance — A personal account has a debit balance when the person is a debtor (owes money to the business) and a credit balance when the person is a creditor (the business owes money to the person).
II. Fill in the Blanks
1. The process of transferring entries from journal to ledger is called posting. 2. Ledger is the principal book of accounts. 3. The left side of a ledger account is called the debit side. 4. The right side of a ledger account is called the credit side. 5. If the credit side total exceeds the debit side total, the account has a credit balance. 6. Cash account always has a debit balance. 7. Nominal accounts are transferred to P&L Account at the end of the year (not balanced). 8. Real accounts are balanced and shown in the Balance Sheet. 9. The abbreviation "c/d" stands for carried down. 10. The abbreviation "b/d" stands for brought down.
III. True or False (with corrections for false statements)
Q1. Ledger is a book of original entry.
AnswerFalse — Correction: The ledger is a book of FINAL entry (or secondary entry). The journal is the book of original entry.
Q2. Posting is the process of transferring entries from journal to ledger.
AnswerTrue — Posting transfers debit entries to the debit side of the relevant ledger account and credit entries to the credit side.
Q3. A cash account can have a credit balance.
AnswerFalse — Correction: A cash account can only have a debit balance or nil balance. It cannot have a credit balance because a business cannot pay out more cash than it receives.
Q4. Nominal accounts are balanced at the end of the year.
AnswerFalse — Correction: Nominal accounts (expenses, incomes, losses, gains) are NOT balanced. They are transferred to the Profit & Loss Account at the end of the year.
Q5. Real accounts are shown in the Balance Sheet.
AnswerTrue — Real accounts (assets) are balanced and their balances are shown in the Balance Sheet.
IV. Match the Following
| Column A | Column B | Answer |
|---|
| 1. Ledger | (a) Book of original entry | (b) Book of final entry |
| 2. Posting | (b) Book of final entry | (c) Transferring from journal to ledger |
| 3. Debit balance | (c) Transferring from journal to ledger | (d) Debit side exceeds credit side |
| 4. Credit balance | (d) Debit side exceeds credit side | (e) Credit side exceeds debit side |
| 5. Cash account | (e) Credit side exceeds debit side | (a) Always has debit balance |
V. Answer Briefly (2-mark questions)
Q1. What is a ledger? What are its advantages?
Answer
A ledger is the principal book of accounts that contains all the accounts of a business. Transactions recorded in the journal are posted to the ledger to classify them under each account. Advantages: (1) It provides a classified record of all transactions under each account, (2) It helps determine the balance of each account, (3) It facilitates preparation of trial balance, (4) It helps prepare financial statements.
Q2. Distinguish between journal and ledger.
Answer
| Feature | Journal | Ledger | |---|---|---| | Nature | Book of original entry | Book of final entry | | Order | Chronological (date-wise) | Account-wise | | Process | Recording (journalising) | Classifying (posting) | | Format | Debit and credit in adjacent columns | T-shaped account format | | Purpose | To record transactions | To classify and find balances |
Q3. What is posting? What are the rules of posting?
Answer
Posting is the process of transferring entries from the journal to the respective ledger accounts. Rules: 1. The account debited in the journal is posted to the debit side of that account 2. The account credited in the journal is posted to the credit side of that account 3. In the particulars column, the name of the other account is written (cross-reference) 4. The J.F. (Journal Folio) number is entered for reference
Q4. What is balancing of a ledger account?
Answer
Balancing is the process of finding the difference between the total of the debit side and the total of the credit side of a ledger account. The difference is written as "Balance c/d" on the side with the smaller total. The balance is then brought forward as "Balance b/d" on the opposite side at the beginning of the next period.
VI. Answer in Detail (5-mark questions)
Q1. Journalise the following transactions and post them to the Ledger:
Answer
2024 January 1: Started business with cash ₹1,00,000 January 3: Purchased goods for cash ₹20,000 January 5: Sold goods for cash ₹30,000 January 8: Purchased goods from Ram ₹15,000 January 10: Sold goods to Suresh ₹10,000 January 15: Paid rent ₹5,000 January 20: Received commission ₹2,000 January 25: Paid to Ram ₹14,500 in full settlement January 28: Withdrew cash for personal use ₹3,000
Journal Entries:
Date | Particulars | L.F. | Debit (₹) | Credit (₹)
----------|--------------------------------------|------|-----------|----------
Jan 1 | Cash A/c Dr | | 1,00,000 |
| To Capital A/c | | 1,00,000
| (Being business started with cash) | |
----------|--------------------------------------|------|-----------|----------
Jan 3 | Purchases A/c Dr | | 20,000 |
| To Cash A/c | | 20,000
| (Being goods purchased for cash) | |
----------|--------------------------------------|------|-----------|----------
Jan 5 | Cash A/c Dr | | 30,000 |
| To Sales A/c | | 30,000
| (Being goods sold for cash) | |
----------|--------------------------------------|------|-----------|----------
Jan 8 | Purchases A/c Dr | | 15,000 |
| To Ram A/c | | 15,000
| (Being goods purchased from Ram) | |
----------|--------------------------------------|------|-----------|----------
Jan 10 | Suresh A/c Dr | | 10,000 |
| To Sales A/c | | 10,000
| (Being goods sold to Suresh) | |
----------|--------------------------------------|------|-----------|----------
Jan 15 | Rent A/c Dr | | 5,000 |
| To Cash A/c | | 5,000
| (Being rent paid) | |
----------|--------------------------------------|------|-----------|----------
Jan 20 | Cash A/c Dr | | 2,000 |
| To Commission A/c | | 2,000
| (Being commission received) | |
----------|--------------------------------------|------|-----------|----------
Jan 25 | Ram A/c Dr | | 15,000 |
| To Cash A/c | | 14,500
| To Discount Received A/c | | 500
| (Being payment to Ram in full settlement) | |
----------|--------------------------------------|------|-----------|----------
Jan 28 | Drawings A/c Dr | | 3,000 |
| To Cash A/c | | 3,000
| (Being cash withdrawn for personal use) | |
Ledger Accounts:
Cash Account (Dr)
Date | Particulars | J.F. | Amount | Date | Particulars | J.F. | Amount
-------|--------------------|------|---------|--------|---------------|------|--------
Jan 1 | To Capital A/c | |1,00,000 | Jan 3 | By Purchases | | 20,000
Jan 5 | To Sales A/c | | 30,000 | Jan 15 | By Rent A/c | | 5,000
Jan 20 | To Commission A/c | | 2,000 | Jan 25 | By Ram A/c | | 14,500
| | | | Jan 28 | By Drawings | | 3,000
| | | | Jan 31 | By Balance c/d| | 89,500
-------|--------------------|------|---------|--------|---------------|------|--------
| | |1,32,000 | | | |1,32,000
-------|--------------------|------|---------|--------|---------------|------|--------
Feb 1 | To Balance b/d | | 89,500 | | | |
Capital Account (Cr)
Date | Particulars | J.F. | Amount | Date | Particulars | J.F. | Amount
-------|-----------------|------|--------|--------|---------------|------|--------
Jan 31 | To Balance c/d | |1,00,000| Jan 1 | By Cash A/c | |1,00,000
-------|-----------------|------|--------|--------|---------------|------|--------
| | |1,00,000| | | |1,00,000
-------|-----------------|------|--------|--------|---------------|------|--------
| | | | Feb 1 | By Balance b/d| |1,00,000
Purchases Account (Dr)
Date | Particulars | J.F. | Amount | Date | Particulars | J.F. | Amount
-------|--------------------|------|--------|--------|---------------|------|--------
Jan 3 | To Cash A/c | | 20,000 | Jan 31| To P&L A/c | | 35,000
Jan 8 | To Ram A/c | | 15,000 | | | |
-------|--------------------|------|--------|--------|---------------|------|--------
| | | 35,000 | | | | 35,000
Note: Purchases is a nominal account — transferred to P&L, not balanced.
Common Mistakes to Avoid
- Posting to the wrong side: If a journal entry debits Account A and credits Account B, then in Account A's ledger, the entry goes on the DEBIT side (with "To Account B" in particulars), and in Account B's ledger, the entry goes on the CREDIT side (with "By Account A" in particulars).
- Writing the account's own name in particulars: The particulars column should contain the name of the OTHER account involved, not the account's own name.
- Forgetting to balance the account: After posting all entries, total both sides, find the difference, and insert "Balance c/d" and "Balance b/d".
- Balancing nominal accounts: Nominal accounts (expenses, incomes) are NOT balanced — they are transferred to the P&L Account at the end of the year.
- Confusing "To" and "By": On the debit side, use "To" (the account receiving). On the credit side, use "By" (the account giving or the source).
- Not carrying forward the balance: After writing "Balance c/d" and closing the account, always bring the balance forward as "Balance b/d" on the opposite side at the start of the next period.
Exam Checklist
- [ ] Can you define a ledger and distinguish it from a journal?
- [ ] Can you post journal entries to the correct ledger accounts?
- [ ] Can you format a T-shaped ledger account correctly?
- [ ] Can you balance a ledger account (find the difference, insert c/d and b/d)?
- [ ] Can you identify which accounts have debit balances and which have credit balances?
- [ ] Can you explain why a cash account always has a debit balance?
- [ ] Can you explain why nominal accounts are not balanced but transferred to P&L?
- [ ] Can you handle discount entries in ledger accounts (Discount Allowed, Discount Received)?
- [ ] Can you post entries involving personal accounts (debtors and creditors)?
- [ ] Can you prepare a complete set of ledger accounts from given transactions?
