Page 14 - Book-keeping for Secondary Schools Student’s Book Form One

Book-Keeping for Secondary Schools

(ii) Recording the transactions in the Posting transactions to the ledger
books of prime entry, accounts
(iii) Posting transactions to the ledger The third stage in the accounting cycle
accounts, is posting transactions to the ledger

(iv) Extracting the trial balance, accounts. This process involves the
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(v) Making adjusting entries and posting of entries that were initially
correction of errors, recorded in the books of prime entry to
the ledger accounts. The posting of entries
(vi) Extracting the adjusted trial balance, to the respective ledger accounts is done
(vii) Preparing the financial statements, by following the double entry system of
and Book-keeping.
(viii) Analysing and interpreting the

financial statements. Extracting the trial balance
The fourth stage in the accounting cycle
Identifying transactions and recording
in source documents is the extraction of the trial balance.
This is the first stage in the accounting The trial balance is a list prepared at
process where financial transactions are a specific date showing net figures or
identified and evidenced through source balances of all general ledger accounts.
documents such as receipts, payment The account balances extracted from the
vouchers, invoices, cheques, debit note general ledger are listed in the debit and
and credit note. For a transaction to be credit columns of the trial balance. The
debit and credit columns must balance.
identified and evidenced, it must be of a The trial balance is usually prepared to
financial value and it must affect at least
two items of the accounting equation. check the arithmetical accuracy of double
entries made to the ledger accounts, and it

Recording the transactions in the books acts as a compiled list of balances for use
of prime entry in the preparation of financial statements.
The second stage is to record such
transactions in the books of prime entry, Account: This is a summarised
which are also known as books of original record of business transactions. It can
entry. The transaction is initially recorded be presented on a page of a ledger
in these books before it is recorded or book.
posted anywhere else. This book will Debit and Credit: These are two
focus on six types of books of prime
entry, namely a sales journal, a purchases terms which are used in describing
journal, a sales returns journal, a purchase the two sides of an account, that is,
returns journal, a general journal, and a the left-hand side (Debit) and the
cash book. right-hand side (Credit).

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Student’s Book Form One

Book Keeping Form 1 New 2024 FINAL.indd 6 18/10/2024 10:14