Ask Me Help Desk

Ask Me Help Desk (https://www.askmehelpdesk.com/forum.php)
-   Accounting (https://www.askmehelpdesk.com/forumdisplay.php?f=19)
-   -   How do I balance a ledger with credit entries? (https://www.askmehelpdesk.com/showthread.php?t=598301)

  • Sep 21, 2011, 05:16 PM
    boillardt
    How do I balance a ledger with credit entries?
    How do I balance a general ledger that has only credit entries?
  • Sep 22, 2011, 02:29 AM
    Unknown008
    How can you have a general ledger without any debit entries? :confused:

    If one makes expenditure, one have to have some money beforehand, be it from capital, from loan of through other facilities, which brings it back to creating a certain debit entry. Either that, or there is some debit balance brought from previous accounts.
  • Sep 22, 2011, 06:46 AM
    pready
    You can't, as for every journal entry your debit entry amounts must equal your credit entry amounts.

    For example: An owner invested cash into to business. Your journal entry will be;
    Debit Cash for the amount invested
    Credit the owners Capital account for the same amount.

    Another example: Purchased a vehicle for $30,000 with a $5,000 deposit and the rest on a note. Your journal entry will be;
    Debit Vehicle for 30,000
    Credit Cash for 5,000
    Credit Notes Payable for 25,000

    In this example your debits and credits equal 30,000 even though you have 2 credit entries and only 1 debit entry. This is known as a compound journal entry and is correct.

  • All times are GMT -7. The time now is 08:41 AM.