Ledger

A ledger is a compilation of a total group of related accounts in double-entry bookkeeping. Also called book of final entry, a ledger documents confidential and summarized financial information from journals (the ‘books of original entry’) as debits and credits, and confirms their present balances.

Types of Ledgers

The majority businesses use the following ledgers:

–Sales Ledger: This book holds the individual accounts for customers or debtors. It is a secondary ledger to which debits and credits from a salesjournal are shifted.

–Purchases Ledger : This book holds the individual accounts for suppliers or creditors. It is a secondary ledger to which debits and credits from a purchasesjournal are shifted.

–General Ledger: Summing up of all financial transactions (collected from subsidiary ledgers) during an accounting stage is recorded. It is named the book of final entry; it provides the total data for organizing financial statements for the business. Hence the remaining double-entry accounts such as those connected to capital, fixed assets, expenses and revenues ( excluding cash account and bank account ) are going into  in the general ledger.