Posting to the General Ledger
,As you make the adjusting entries to correct errors or complete transaction information, keep a worksheet of all the entries. Ultimately you will need to post them to the general ledger to maintain the balance of your books.
You don’t need to post to the general ledger as you find each correction. After you’ve finished closing your sub-ledgers you can post corrections in an entry that summarizes the changes.
For example, if you found several corrections when closing the cash receipts journal, you would post the details involving specific customers or receipts to that journal, but you only need to summarize the amounts for the general ledger.
Closing books and making corrections is a lot easier if you are using a computerized accounting system. A correction made to a specific entry automatically updates the control accounts in the general ledger.
Now let’s take a closer look at how you close the payroll journal and employee expense accounts.
The Least You Need to Know
• Month-end closing is a bottom-up approach. You start with the details of sub-ledgers and work up to the master controller, the general ledger.
• Closing your cash receipts journal also provides an excellent opportunity to review the accuracy of your sales numbers, as well as manage your credit sales.
• When closing the cash disbursements journal, you not only check for errors, but you also make sure you have accurately matched the expenses for the month and accrued any costs or expenses not yet paid.
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