What is a Ledger?

A group of Account is known as a ledger.After the transactions have been recorded in the journal the accounts are prepared in this book.The Ledger is,therefore, a derived or secondary record.Its source of information is the book of original entry, that is journal. The ledger is considered to be the principal or main book of account.

Broad Sub Division Of Ledger

The Ledger is broadly divided into two:

  • Personal Ledger
  • Impersonal Ledger

Personal accounts,that is accounts of debtors and creditors are maintained in the personal ledger.All other accounts, real and nominal accounts are maintained in the impersonal ledger.If personal accounts are large in number there may be two ledgers to record them,one for debtors and other for creditors accounts. Sometimes there may also be a private ledger to ensure secrecy regarding entries made in the capital and drawings accounts of the proprietor or partners.Thus the usual sub-divisions are

Usual sub-divisions of Ledgers

  • Sales Ledger: Containing accounts of debtors
  • Purchase Ledger : Containing accounts of Creditors
  • Impersonal Ledger or Nominal Ledger  or General Ledger: Containing real and nominal accounts.
  • Private Ledger : Containing capital account, drawings account.

The Ledger is usually a bound book where only one account is placed in each page.Under modern system of computerization eliminate the need of bound books, ledger posting and viewing can be done with the help of few clicks.

Also read : Subsidiary Ledger

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