Sample General Ledger Journal Entry
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The following sample general ledger journal entry and general ledger examples use Sunny Sunglasses Shop's chart of accounts to classify each posting by account number.
Let's continue our example by posting the four transactions in the accounting journal into the general ledger accounts.
Sample General Ledger Journal Entry
As a quick recap, the following transactions occurred on January 1, 2007 to start Sunny Sunglasses Shop:
- Jan. 1 Sunny invested $50,000 into his new business, Sunny Sunglasses Shop.
- Jan. 1 Purchased inventory for $4,500. Paid $3,000 cash, with the balance of $1,500 due in 90 days.
- Jan. 1 Purchased land for $20,000 with $2,000 as a down payment, and a 15 year mortgage for $18,000.
- Jan. 1 Purchased insurance for the year for $2,400.
The above events are posted to the general ledger from the general journal as follows:
General Ledger Examples
Notice that the sample general ledger is a composite of each account, also called "T-Accounts" because of the appearance of the letter T. Each account still uses double entry accounting that the accounting journal uses (below), but places each journal entry into the separate general ledger account for a summary of each account. The main general ledger account numbers appear on the right side of each account. Each general ledger account references the source from which the transaction was posted. "GJ-1" means the first page of the general journal.
Adding the columns for each account and taking the difference between the two columns equals the balance of the account. For example, the debit column of cash totals $50,000, and the credits total $7,400. The difference between the two equals $42,600.
Just as the general ledger accounts each reference the accounting journal as a source of the transfer, the accounting journal now references each general ledger account in the reference column, which completes the posting for the general journal below.
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