A ledger is a book or electronic system that contains a detailed record of all financial transactions made by a business. It serves as a central hub for organizing and tracking the flow of money in and out of the company. By recording every transaction such as sales, purchases, and payments, the ledger provides a clear and accurate picture of the company’s financial health.

One of the key benefits of maintaining a ledger is the ability to create a balance sheet, which shows the company’s assets, liabilities, and equity at a specific point in time. This information is crucial for investors, lenders, and other stakeholders who rely on accurate financial statements to make informed decisions.

In conclusion, a ledger is an essential tool in business finance that helps businesses track their financial transactions, create accurate financial statements, and make informed decisions. Understanding the importance of the ledger is crucial for maintaining financial stability and growth in the business world.#25#