Posting Transactions and Double-Entry

This is about transferring journal entries into their proper accounts in the general ledger.

🧾 Real-World Analogy:
Imagine writing expenses in your notebook (the journal), and later updating your budget spreadsheet (the ledger).

You bought lunch → journal records the purchase.
Then, you update the “Food” cell in your spreadsheet → ledger gets updated.

In accounting:

Each transaction is posted to individual T-accounts from the general journal.
You update both sides of the transaction (debit and credit) into the respective accounts.

These show running balances after each transaction.

✅ Structure:

Date | Explanation | Debit | Credit | Balance

Example from image:

Start with $30,000
Subtract $2,500 → $27,500
Subtract $26,000 → $1,500
Add $4,200 → $5,700

💡 Analogy:
Think of it like your bank app: You see your daily deposits (debits) and withdrawals (credits), and your current balance is always updated below.

🧩 Overview:

This section shows how a single transaction flows from start to finish in three steps:

🟥 Step 1: Identify

Find the transaction and its source document.
Example: The owner invests $30,000 into the business.

🟨 Step 2: Analyze

Use the accounting equation:

Assets = Liabilities + Equity

Cash (Asset) ↑ $30,000
Capital (Equity) ↑ $30,000

So it stays balanced.

🟩 Step 3: Record

Enter into the journal:

Debit Cash $30,000
Credit Owner’s Capital $30,000

Then ➡️ Post to the ledger:

Cash account → increase by debit
Capital account → increase by credit

🔷 Posting Transactions to the Ledger

🔷 Balance Column Accounts

✅ Structure:

🔷 Double-Entry Accounting in Practice

🧩 Overview:

🟥 Step 1: Identify

🟨 Step 2: Analyze

🟩 Step 3: Record