The General Ledger and the General Journal

Question 1

Ledger Account

Answer 1

an Accounting record showing all the transactions that affect a particular item

Question 2

General Ledger

Answer 2

the Collective name for the main group of ledger accounts

Question 3

Debit

Answer 3

The left-hand side of a ledger account.
Includes ASSETS, DRAWINGS and EXPENSES.
Rises with a Debit, Falls with a Credit.

Question 4

Credit

Answer 4

the right-hand side of a ledger account.
includes LIABILITIES, REVENUES and OWNER’S EQUITY.
These fall with a Debit and rise with a Credit.

Question 5

Cross-Reference

Answer 5

the name of the other account affected by a transaction, so that both accounts affected by a particular transaction can be verified.

Question 6

Cost Of Sales

Answer 6

the value of Inventory that has been sold in a particular period, valued at its cost price.

Question 7

Trial Balance

Answer 7

A list of all the accounts in the General Ledger, and their balances, to determine if total debits equal total credits.

Question 8

Balancing

Answer 8

the process of ruling off an asset, liability or owner’s equity account to determine its balance at the end of the current period and transferring the balance to the next period.