Before computers, accountants used special paper with columns to summarize general ledger entries. Columnar worksheets made accounting projects easier than if they were written on notebook paper. These single padded sheets continue to be available from office supply stores. Columnar worksheets still serve a purpose, although their use has declined with the increased use of Excel, Open Office and purchased accounting programs for spreadsheets.
How It Works
The columnar worksheet, sometimes called finance paper, has columns for different entries. Several designs are available for students or businesses. The columnar worksheet has chronological numbers down the left side, and five or more vertical columns with horizontal lines for each number on the left. The worksheet is an informal place to accumulate, sort and organize figures for financial statements or reports. You don't have to use columnar worksheets, but they help if you work with many figures in your small business.
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General Ledger
An accountant records all transactions in the general ledger. The general ledger entries collect information about a small business's accounts, organized by account type. General ledger entries come from the daily journal, and the accountant organizes these entries by account, not by day. If journal entries are up to date, general ledger entries involve transferring the calculations to two, three or four columns. Two columns include accounts receivable and accounts payable. A three-column general ledger includes the account balance, and a four-column ledger indicates whether the balance is a net debit or credit.
Columnar Worksheets
Worksheets are an informal record of information needed for financial statements, taxes or income statements. You can use the columnar worksheet to adjust trial balances and accumulate all information necessary for the financial statement. One column for accounts may have title and code. The second column for trial balance and all additional columns have columns split into debit and credit. Adjustments are the third column, and the adjusted trial balance is in the fourth column. The fifth column is the statement of income and expenses, and the sixth column is the balance sheet.
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Spreadsheet
An electronic spreadsheet uses the computer to make the columns and calculations. Programs such as Excel and Open Office provide cells that create a grid of rows and columns like a columnar worksheet. The difference in the columnar worksheet and the computer is that the computer updates the calculations based on a formula you input for the cells. You don't have to recalculate when you make changes, as the computer does it for you. A small-business owner without any accounting background can learn to use an electronic spreadsheet to track business income and expenses.
