1. The Simple Ledger Chapter 4.1

2.  An account is a page specially designed to record the changes in each individual item affecting financial position  There is one account for each item  All of the accounts stored together is called the ledger

3.  Most large businesses use computer software to store account information, and keep backups of all accounts

4. Important information about ledgers  Each item on a balance sheet is given its own page with the name at the top  The first line of each page is the beginning balance  It is important to record the dollar figure on the correct side of the ledger page  The side of the account depends on the type of account

5. Sample T account Cash +- Loan -+

6.  All Assets are recorded on the left hand side of the account  All Liabilities and Owners Equity are recorded on the Right hand side  Note this is similar to the setup of the simple balance sheet

7.  Both the Simple Balance sheet and the simple ledger show financial position, if you have a ledger you can prepare a balance sheet, if you have a balance sheet you can prepare a ledger