After we create the transactions, then we've got the journal, we've got the general ledger that we need to post to the general ledger is simply the book of record. It's simply the place where you accumulate what's happened. So there be historically there would be two kinds of books and accounting, there would be the journal and a whole bunch of activity happens through the day. It's all the receipts. It's a simple log of each transaction. But at the end of the day, you kind of have to sort that log and decide which things affect cash, which things affected my expenses, which things affected, my house payment, what did I buy that I put into inventory that becomes an asset that I own.

That sorting of the log of the transactions, the journals, and then deciding how they update balances is really the process of posting to the general ledger. The general ledger usually has yesterday's balances, you take in today's transactions and update yesterday's balances to create today's balances. That's called a posting process. That's something we'll talk a lot more about in my subsequent courses, is posting processes are all over the world, in all kinds of business processes that undergirds everything we do in business. The general ledger is just one type of ledger. There's many different kinds of Ledger's, you can have Ledger's that keep track of investments in Ledger's to keep track like, actually your checking account, your credit card account, all of those things are different kinds of Ledger's.

When you get to the general ledger, though, the general ledger is a summary of all of those more detailed Ledger's into one place. It gives you the net results for either a person, a family, department, a division, a company or a country. It is the thing that accumulates across all of the subsidiary ledgers. They're called those more detailed Ledger's into one location. That's posting the journal entries to the general ledger.