Chapter 5, Problem 5.11EX

To determine

Purchase journal

Purchase journal refers to the journal that is used to record all purchases on account. In the purchase journal, all purchase transactions are recorded only when the business purchased the goods on account. For example, the business purchased cleaning supplies on account.

General Ledger

General ledger refers to the ledger that records all the transactions of the business related to the company’s assets, liabilities, owners’ equities, revenues and expenses. Each subsidiary ledger is represented in the general ledger by summarizing the account.

Subsidiary ledger

Subsidiary ledger refers to the ledger that provides the detailed information of the account already recorded in the general ledger such as accounts receivable subsidiary ledger and accounts payable subsidiary ledger.

To identify:  The postings to be done in (1) General ledger accounts or (2) Subsidiary ledger accounts or (3) No posting is required.