1. Ledgers

Question 1

What is a ledger?

Answer 1

Ledger accounts record and analyse all the individual transactions of a business. Each transaction will be dated and recorded in chronological order using double entry.

The ledgers can then build up the totals for each day, week, month and year.

Each item within the statement of financial position and the statement of profit or loss will have its own ledger account.

Ledger accounts often take the form of T accounts.

Question 2

What is the nominal ledger?

Answer 2

The nominal ledger groups together all the individual ledger (T) accounts for each type of income, expense, asset and liability and for capital.

Question 3

What is the receivables ledger?

Answer 3

The receivables ledger is a separate memorandum ledger account for each credit customer.

Question 4

What is the payables ledger?

Answer 4

The payables ledger contained a separate memorandum ledger account for each credit supplier.