Ledgers

A ledger is a book or a record where financial transactions are recorded. It helps keep track of all the money coming in and going out. You can think of it as a detailed account of all the financial activities of a person, business, or organization. In a ledger, each transaction is usually recorded in a separate row or entry. It includes information like the date, description of the transaction, and the amount of money involved. For example, if you buy a new pair of shoes, you would record that expense in your ledger.

Ledgers are important because they help in maintaining accurate financial records. They provide a clear overview of a person’s or business’s financial health. They can be used to track expenses, calculate profits, and prepare financial statements like balance sheets or income statements. In the past, ledgers were physical books where entries were made by hand. But nowadays, with computers and accounting software, ledgers can be digital. They’re stored electronically, making it easier to update and analyze financial data.