A ledger is a record-keeping tool that is used in accounting to track financial transactions. It is the backbone of financial management and provides a complete picture of a company’s financial health. The ledger contains all the accounts and transactions of a business, including assets, liabilities, equity, revenue, and expenses.

Ledgers can be kept manually or electronically using accounting software. Regardless of the method, maintaining a ledger is critical for accurate financial reporting and decision-making. It helps businesses monitor their cash flow, track expenses, and identify trends in their finances.

In addition to tracking financial transactions, a ledger also helps businesses prepare financial statements, such as balance sheets and income statements. These statements provide a summary of a company’s financial position and performance over a specific period.

Overall, a ledger is a fundamental tool in financial management that helps businesses analyze their financial performance, make informed decisions, and ensure compliance with accounting standards.#25#