Importance And Utility Of Ledger Accounts

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The following are the important utilities of ledger accounts

1. Ledger account keeps a permanent record of all financial transactions in a classified manner.
2. Ledger account shows detailed financial information of a business regarding debtors and creditors, assets, and incomes and expenses.
3. Ledger account helps to prepare a trial balance in order to check the arithmetical accuracy of the recording of the financial transactions of the business.
4. Ledger account helps to prepare profit and loss account so as to ascertain the profit or loss of the business.
5. Ledger account helps to prepare the balance sheet with a view to show the financial position of the business.
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