In accounting terms the word "post " means to record a transaction or adjustment to the correct accounts, assigning a debit to one account and an offsetting credit to another. Posting may be a manual task, done only on paper. However, in today's business world most accounting is done on computers. In this case "posting" means entering the transaction into a software program and then saving the transaction so that the appropriate accounts are updated.
Items you will need
- Fundamental understanding of double entry accounting principles
- Working knowledge of accounting software
Basic Posting in Accounting
Assemble all documents that pertain to the transactions that are to be posted. Commonly these are invoices from your vendors that will be posted to Accounts Payable, your invoices to your customers that will be posted to Accounts Receivable, or sometimes General Ledger adjustments.
Determine the accounts that will be debited and credited when you post. For instance, to post an outstanding debt owed to another party, like an invoice from your vendor, an expense account or an asset account will be debited and a liability account will be credited. Example:Posting an invoice you owe to Acme Electricity for $10.00 will result in the following transaction:Utilities expense (expense account) 10.00 and Debit Accounts payable (liability account) 10.00 Credit
If you are posting the transaction manually, the posting process simply involves writing the numbers in the account pages and updating the account balances. Be sure to update all associated accounts.
For computerized posting, log into your software and enter the appropriate module. For our posting example, the module will probably be called Accounts Payable. According to your software instructions enter the account number or name for the expense account (Utilities Expense, for our example) and the amount to be paid in the appropriate fields. Your software will also ask you for a payment due date. You may also need to enter discount terms, if there are any. These will be specified on the invoice, if applicable.
Before posting, save your data and print a preliminary report. Compare the data you have entered to the data on the invoice and check for errors. Make corrections to your entered data if necessary.
Once you are certain all your data is entered correctly, select the option in your accounting program to post the data to the accounts. Be sure to print complete reports of the data you have posted for your records. View your account data to be certain your data posted correctly.
Transactions to Accounts Receivable are posted similarly. The accounts affected are usually a revenue account (Income) and an asset account (either Accounts Receivable or Cash). Example: Your invoice for $200.00 for plumbing services provided to your customer would be posted as follows: Accounts Receivable (asset account) $200.00 Debit and Income from plumbing services provided (revenue account) $200.00 Credit
When recording multiple transactions, like a stack of invoices for instance, run an adding machine tape listing the amount of each invoice with a total at the end. This will aid you in checking your data for errors before posting.
Transactions posted directly through your General Ledger (also sometimes called a General Journal) do not differ much from Accounts Payable or Accounts Receivable. When adjusting accounts directly, be extra careful of debiting and crediting in the correct direction. A common error is debiting an account you mean to credit, and conversely incorrectly crediting the account you intend to debit. This sort of posting mistake is not hard to fix, but frustrating even so.