A ledger is a book or computer program used for recording financial transactions in a systematic and organized manner. It serves as the backbone of accounting, providing a detailed account of all the transactions that have taken place within a specific period.

The importance of a ledger in accounting cannot be overstated. It helps in tracking income and expenses, monitoring cash flow, and preparing financial statements. By maintaining a ledger, businesses can have a clear overview of their financial health and make informed decisions based on accurate data.

Ledgers can be kept manually in physical books or electronically through accounting software. They are typically categorized into general ledgers and subsidiary ledgers, with the former containing all financial transactions and the latter providing more detailed information on specific accounts.

In conclusion, a ledger is a vital tool in accounting that helps businesses keep track of their financial activities. Understanding its importance and maintaining accurate records can lead to better financial management and decision-making.#25#