In financial accounting, a ledger is a collection of accounts that record all financial transactions of a specific type. For example, a company’s Accounts Receivable ledger consists of all the accounts that record all the credit sales of the company. A company’s Accounts Payable ledger consists of all the accounts that record all the credit purchases of the company.
To make a ledger entry, first find the account that you will be using. Next, determine the debit or credit amount for the transaction. Finally, enter the transaction amount and the account into your ledger.