The accounting general ledger is the core of your company monetary records. These comprise the essential “books” of your system, and every financial transaction flows throughout the general ledger. These records remain as a permanent way of the history of all financial transactions since day one of the life of your business.
The accounting general ledger, occasionally known as the nominal ledger, is the main bookkeeping record of a company which uses double-entry bookkeeping. It will frequently comprise accounts for such things as current assets, fixed assets, liabilities, revenue and expense items, gains and losses. Each general ledger is separated into two segments. The left hand side lists withdrawal transactions and the right hand side lists credit transactions.
The general ledger is a gathering of the collection of accounts that maintains the importance items revealed in the most important financial statements. It is built up by posting transactions recorded in the sales daybook, purchases daybook, cash book and common journals daybook.
The accounting general ledger can be supported by one or more supplementary ledgers that give aspects for accounts in the general ledger. For example, an accounts receivable supplementary ledger would include a separate account for every credit customer, tracking that customers balance individually. There are some basic categories in which all accounts are grouped – Assets, Liability, Proprietors equity, Income, Expense, Profits, Losses.
There are two important method use every bookkeeper and accounts first is single entry bookkeeping and double entry bookkeeping. When using a double-entry bookkeeping method, a method which relies on the accounting equation, the general ledger is reserved with two opposite posts for each transaction in two separate ledgers or sub-ledgers. This is an advantageous method for the reason that it facilitates make sure that the accounting is reserved in balance, and any mistakes in the accounting are speedily recognized.