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Fundamentals of Accounting · Accounting Process

Ledger Posting and Balancing of Accounts for CSEET

Updated 11 October 2026 · Fact-checked

Ledger posting means copying each journal entry into the ledger, debit amounts on the debit side of one account and credit amounts on the credit side of another. Balancing means totalling both sides, finding the difference, and carrying it down as the closing balance on the smaller side.

Understand Ledger Posting and Balancing of Accounts

The journal is the book where you first record every transaction in date order. It tells you what happened, but it does not tell you where you stand with each person, asset or expense. For that, you need the ledger.

The ledger is the book of accounts. It has a separate page, called an account, for each item such as Cash, Sales, Rent or Ramesh. All transactions about one item sit together. So you can see at once how much cash you hold or how much you owe a supplier.

Posting is the act of transferring entries from the journal to the ledger. Each journal entry has a debit and a credit. You post the debit amount on the debit (left, Dr) side of the debited account. You post the credit amount on the credit (right, Cr) side of the credited account. On each side you write the name of the other account, prefixed with "To" on the debit side and "By" on the credit side.

Balancing means finding what is left in an account at a date. Total the debit side and the credit side. The difference is the balance. If debits are larger, it is a debit balance. If credits are larger, it is a credit balance. You write the balance on the smaller side as "By Balance c/d" or "To Balance c/d" so both sides total the same. Then bring it down on the opposite side as "To Balance b/d" or "By Balance b/d" at the start of the next period.

The difference between the two books is simple. The journal records transactions in date order and is the book of original entry. The ledger groups them by account and is the book of final entry. Balanced ledger accounts are the base for the trial balance.

Key rules to remember

Posting rule
Debit account: post on Dr side with "To (other account)". Credit account: post on Cr side with "By (other account)".
The amount is the same as in the journal. The particulars show the other account of the entry.
Balance of an account
Balance = Total of larger side − Total of smaller side
Write the balance on the smaller side as c/d so both totals match.
Debit balance
Total Dr > Total Cr, so closing balance is a debit balance
Typical for assets, expenses, losses and debtors.
Credit balance
Total Cr > Total Dr, so closing balance is a credit balance
Typical for liabilities, capital, income and creditors.
Carry down
Balance c/d on the smaller side; Balance b/d on the opposite side below the total
The b/d balance is the opening balance of the next period.

How to solve Ledger Posting and Balancing of Accounts questions

Use this method for any question that gives journal entries or transactions and asks for ledger accounts and balances.

  1. 1Read the journal entries. If you are given plain transactions, first journalise them, noting the debit and credit account of each.
  2. 2List all the accounts that appear. Draw one account (Dr side left, Cr side right) for each, with columns for date, particulars, and amount.
  3. 3Post each entry in order. Put the amount on the Dr side of the debited account with "To (credit account)". Put the same amount on the Cr side of the credited account with "By (debit account)".
  4. 4Tick each journal entry once both sides are posted, so you do not miss or double-post any.
  5. 5Total the Dr side and the Cr side of each account in rough work.
  6. 6Find the difference. Write it on the smaller side as "Balance c/d" so both sides are equal. Write the same total on both sides at the same level.
  7. 7Bring the balance down on the opposite side as "Balance b/d". An account with a single entry needs no totalling; its one amount is the balance.
  8. 8Check that total debits of all balances equal total credits of all balances. This is the trial balance check, since the trial balance is prepared from these balances.

Quickest way: Post by account, not by entry, and check with a trial balance

When to use it: Use when there are many entries and few accounts, and time is short.

  1. Draw all the accounts first, leaving a few blank lines in each.
  2. Go through the journal once and post both sides of every entry. Tick as you go.
  3. Do the cash account separately in rough, since it has the most entries.
  4. Total each side lightly in pencil, then write the balance.
  5. Add all debit balances and all credit balances. If they differ, recheck the largest accounts first.

Common mistakes in Ledger Posting and Balancing of Accounts

  • Posting both sides of an entry on the same side

    You copy the amount twice without checking which account is debited and which is credited.

    Fix: For each entry, say aloud: "This account is debited, that account is credited." Then place each on its own side.

  • Writing the wrong account name in particulars

    You write the account you are in, instead of the other account of the entry.

    Fix: In the Cash account, a sale shows "To Sales", not "To Cash". Always write the opposite account.

  • Putting the balance c/d on the larger side

    You confuse which side needs the balancing figure.

    Fix: The balance goes on the smaller side so that both sides total the same. Then bring it down on the opposite side (the side that was larger) below the total.

  • Bringing the balance b/d down before totalling, so it gets added into the total

    You start the new period before closing the old one.

    Fix: Write totals first, then draw a line, then write Balance b/d below the total on the opposite side.

  • Mixing up To/By or using them wrongly

    You memorise the words without linking them to the Dr and Cr sides.

    Fix: Remember: "To" always goes on the Dr side and "By" always goes on the Cr side.

  • Ignoring opening balances

    The question gives them in a note, and you start the account from zero.

    Fix: Enter an opening balance first: assets on the Dr side as "To Balance b/d" and liabilities on the Cr side as "By Balance b/d".

Worked examples

Example 1

Journal entries of Rohan Traders: (1) 1 April: Cash ₹50,000 Dr to Capital ₹50,000. (2) 3 April: Purchases ₹20,000 Dr to Cash ₹20,000. (3) 5 April: Cash ₹8,000 Dr to Sales ₹8,000. (4) 10 April: Rent ₹3,000 Dr to Cash ₹3,000. Prepare the Cash Account and balance it.

Show the solution
  1. Cash is debited in entries 1 and 3: Dr side ₹50,000 (To Capital) and ₹8,000 (To Sales).
  2. Cash is credited in entries 2 and 4: Cr side ₹20,000 (By Purchases) and ₹3,000 (By Rent).
  3. Total Dr = 50,000 + 8,000 = ₹58,000.
  4. Total Cr = 20,000 + 3,000 = ₹23,000.
  5. Balance = 58,000 − 23,000 = ₹35,000. It is a debit balance because Dr is larger.
  6. Write "By Balance c/d ₹35,000" on the Cr side. Both sides now total ₹58,000.
  7. Bring down "To Balance b/d ₹35,000" on the Dr side on 1 May.

Answer: Cash Account closing balance is ₹35,000 (debit), carried down as the opening balance of the next period.

Example 2

Journal entries of Meera Stores: (1) Goods purchased on credit from Anil ₹40,000. (2) Goods returned to Anil ₹5,000. (3) Cash paid to Anil ₹25,000. Prepare Anil's account in the books of Meera Stores and balance it.

Show the solution
  1. Entry 1: Purchases Dr, Anil Cr ₹40,000. Post on the Cr side of Anil's account as "By Purchases ₹40,000".
  2. Entry 2: Anil Dr, Purchases Return Cr ₹5,000. Post on the Dr side as "To Purchases Return ₹5,000".
  3. Entry 3: Anil Dr, Cash Cr ₹25,000. Post on the Dr side as "To Cash ₹25,000".
  4. Total Dr = 5,000 + 25,000 = ₹30,000.
  5. Total Cr = ₹40,000.
  6. Balance = 40,000 − 30,000 = ₹10,000, a credit balance.
  7. Write "To Balance c/d ₹10,000" on the Dr side so both sides total ₹40,000. Bring down "By Balance b/d ₹10,000" on the Cr side.

Answer: Anil's account shows a credit balance of ₹10,000, which Meera Stores still owes him.

Exam tips

  • Draw accounts neatly with Dr and Cr sides and date, particulars and amount columns. Presentation earns marks.
  • Always write the opposite account in particulars, with "To" on the Dr side and "By" on the Cr side.
  • Show the totals on both sides at the same level, and show balance c/d and b/d clearly.
  • If the question gives opening balances, post them first. Missing them is the most common way to lose marks.
  • After posting, add the debit and credit balances of all accounts. A mismatch tells you there is an error before you submit.

Practice questions from Accounting Process

Ledger Posting and Balancing of Accounts in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Ledger Posting and Balancing of Accounts: frequently asked questions

What is the difference between journal and ledger?

The journal records transactions in date order and is the book of original entry. The ledger groups the same entries by account and is the book of final entry. You post from the journal to the ledger.

How do you balance a ledger account?

Total both sides and find the difference. Write the difference on the smaller side as balance c/d so both sides match. Then bring it down on the opposite side as balance b/d.

Why do we use To and By in the ledger?

They show the side of the entry. "To" is used on the debit side and "By" on the credit side. The name that follows is the other account of the journal entry.

Do all ledger accounts need balancing?

Accounts with entries on both sides are balanced. Income and expense accounts are normally transferred to the final accounts at the end of the period. Asset, liability and capital balances are carried forward.