Tag: explain the concept of ledger and its importance in accounting process.

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Multiple choice elements of accounts ledger and posting explain the concept of ledger and its importance in accounting process. introduction to ledgers ledgers

Which is recorded in the purchases ledger?

  1. Cash paid to a creditor

  2. Cash purchases

  3. Cheque received from a debtor

  4. Purchase of fixed assets
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The purchases ledger tracks transactions with creditors. Cash paid to a creditor is a transaction that affects the creditor's account, so it is recorded in the purchases ledger.

Multiple choice elements of accounts ledger and posting explain the concept of ledger and its importance in accounting process. introduction to ledgers ledgers

Which ONE of the following, in a classified form, contains permanent records of all transactions?

  1. Cash Book

  2. Sales Day Book

  3. Journal

  4. Ledger
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

The ledger is the final book of entry where transactions from the journal are posted and classified into permanent accounts, providing a summarized record of all business activities.

Multiple choice elements of accounts ledger and posting explain the concept of ledger and its importance in accounting process. introduction to ledgers ledgers

Which of the following is not a book of prime entry?

  1. Cash book

  2. Returns Inwards Day Book

  3. The Petty Cash Book

  4. The Ledger
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Books of prime entry (or original entry) are where transactions are first recorded, such as the Journal or Day Books. The Ledger is a book of secondary entry where information is posted from the books of prime entry.

Multiple choice elements of accounts ledger and posting explain the concept of ledger and its importance in accounting process. introduction to ledgers ledgers

Ledger is book for _____________.

  1. Analytical record

  2. Chronological record

  3. Alphabetical record

  4. None of above
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

A ledger is an accounting book that facilitates the transfer of all journal entries in a chronological sequence to individual accounts. The process of recording journal entries into the ledger is called posting.

Multiple choice elements of accounts ledger and posting explain the concept of ledger and its importance in accounting process. introduction to ledgers ledgers

Process of recording transaction in ledger is known as ____________.

  1. Balancing

  2. Posting

  3. Journalizing

  4. None of above
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Posting is the accounting process of transferring information from the journal (or books of original entry) to the appropriate accounts in the ledger.