Gujarat BoardEnglish MediumSTD 11 CommerceAccountP1 C9 Ledger-Posting2 Marks
Question
Explain the importance of a ledger.
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Answer
Following are some of the important utilities of ledger :
$(1)$ Total capital employed in the business by owner/s of business can be easily found out on a particular day.
$(2)$ At the end of accounting year, from the balances of different accounts from ledger, finalaccounts can be prepared. From the final accounts, one can get the idea of total profit or loss of thebusiness.
$(3)$ During the year, different types of assets are purchased by business. Now what is the valueof an asset, at the end of the year, after deducting depreciation can be easily known from the ledger
$(4)$ From the ledger, total purchase, sale, return of goods, goods goes out by any means etc, canbe known easily.
$(5)$ From the ledger, at the end of specific period, one can know the total amount payable orreceivables for business. How much can be receivable from custombers or how much is payable to traders can be knownfrom ledger.
$(7)$ From the ledger, it is possible to know the total incomes and total expenses of specifi periodfor the business.
$(8)$ To take the policy decision and to get the quantitative information ledger is the best tool.
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