Assets Ledger account are those accounts that are related to assets of the business. Assets mean something valuable that a business owns and get benefits from it in the future or has use of it in generating income.
Steps of closing assets Ledger account: –
It is also known as the Closing of assets Ledger account for the specific account. The closing of ledger accounts is included in the following steps: –
- 1st Step: Totaling both sides.
- 2nd Step: Writes the total of the largest side on both sides.
- 3rd Step: Subtract the shorter side total from the larger side total.
- 4th Step: Now, Write a balanced amount of the larger side which we get after subtracting it from the shorter side on the shorter side of the ledger account.
Note: –
- Assets ledger account always has a “Debit balance”
- Assets Ledger account balance will always carry forward to the next financial year.
Now we will explain it further with the help of the following illustration.
We will show only transactions related to the particular Asset account
Illustration:
Prepare Bank A/c for the Month of Jan-18.
| Date | Transaction | Amount |
| 01/01/18 | Debit balance in the Bank a/c | 300,000 |
| 08/01/18 | Purchase goods from Pawan and paid with a cheque | 200,000 |
| 22/01/18 | Sold goods to Shallu and she paid with a cheque | 175,000 |
| 31/01/18 | Salary paid to Employees | 50,000 |
Solution:
After posting all the transaction in the journal and then posted it in the ledger we will get a ledger account as shown below:
Bank A/c
| Date | Particulars | J.F. | Amount | Date | Particulars | J.F. | Amount |
| 01/01/18 | To Balance B/d | 300,000 | 08/01/18 | By Purchase a/c | 200,000 | ||
| 22/01/18 | To Sale a/c | 175,000 | 31/01/18 | By Salary a/c | 50,000 | ||
2nd Step: Writes the total of the largest side on both sides. So, that is 475,000/-
Bank A/c
| Date | Particulars | J.F. | Amount | Date | Particulars | J.F. | Amount |
| 01/01/18 | To Balance B/d | 300,000 | 08/01/18 | By Purchase a/c | 200,000 | ||
| 22/01/18 | To Sale a/c | 175,000 | 31/01/18 | By Salary a/c | 50,000 | ||
| 475,000 | 475,000 |
Total of the debit side(Largest side) subtracted from the credit side total(shortest)
we got 475000 – 250000 = 225,000/-
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4th Step: Now, Write a balanced amount of the larger side which we get after subtracting it from the shorter side on the shorter side of the ledger account as shown below.
Bank A/c
| Date | Particulars | J.F. | Amount | Date | Particulars | J.F. | Amount |
| 01/01/18 | To Balance B/d | 300,000 | 08/01/18 | By Purchase a/c | 200,000 | ||
| 22/01/18 | To Sale a/c | 175,000 | 31/01/18 | By Salary a/c | 50,000 | ||
| 31/01/18 | By Balance c/d (B. Fig.) | 225,000 | |||||
| 475,000 | 475,000 |
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