What is General Ledger?
Definition
A general ledger is the master accounting record that contains all financial transactions of a business, organised by account, forming the basis for financial statements.
Explained Simply
The general ledger organises transactions into individual accounts (e.g., Cash, Accounts Receivable, Revenue, Rent Expense). Each account shows debits, credits, and running balances. In modern accounting software like Accounter, the general ledger is maintained automatically as you record transactions. At any point, you can generate a trial balance from the ledger to check that debits equal credits. The ledger feeds directly into financial statements.
Related Terms
Chart of Accounts
A chart of accounts is a structured list of all the accounts used by a business to classify and record financial transactions in the general ledger.
Trial Balance
A trial balance is a report listing all accounts in the general ledger with their debit or credit balances, used to verify that total debits equal total credits.
Journal Entry
A journal entry is a record of a financial transaction in the accounting system, showing the accounts affected, the amounts debited and credited, and the date of the transaction.
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