Posting the Opening Entry

The opening entry is passed to open the books of accounts for the new financial year. The debit or credit balance of an account what we get at the end of the accounting period is known as closing balance of that account. This closing balance becomes the opening balance in the next accounting year.

The procedure of posting an opening entry is same as in the case of an ordinary journal entry. An account which has a debit balance, the words ‘To balance b/d’ are recorded on the debit side in the particulars column. An account which has a credit balance, the words “By balance b/d” are recorded in the particulars column on the credit side. Infact opening entry is not actually posted but the accounts are merely incorporated in the ledger, if the ledger is a new one or old.

Illustration .

Post the opening entry into the ledger of Rajan as on 1st April 2003, cash in hand Rs. 10,000; Loan Rs. 1,00,000.

Solution:

In the Books of Rajan
Cash Account

Dr.                                                                                                                                                                                                           Cr.

Date	Particulars	J.F	Rs	Date	Particulars	J.F	Rs
2003 Apr 1	To Balance b/d		10,000

 

Loan Account

Dr.                                                                                                                                                                                                           Cr.

Date	Particulars	J.F	Rs	Date	Particulars	J.F	Rs
				2003 Apr 1	By Balance b/d		1,00,000