38 General Ledger Templates Free Download In Excel & Word

It becomes simpler to spot any benefits or difficulties that influence your entire business when you take a holistic approach. Because it comprises a record of all transactions from the beginning of your company to the present, you can rely on a general ledger template for a holistic picture when it comes to business.

What is general ledger with an example?

A general ledger template is a main sheet that contains all of your company's accounting information. This implies it contains all of your company's transactions dating back to its inception. One of the major functions of this ledger is to categorize these transactions so that you can see how much money you've made and how much money you've spent.

The difference between your credits and debits is reflected in the balance of an accounting ledger template. Subtract the number of debits from the total number of credits to arrive at this figure. The information in the ledger is crucial since it will serve as the foundation for making well-informed judgments.

A general payment ledger template is essential for your business files since it organizes and records all payments between your business accounts. The information in the ledger gives you a larger view of your company's development and profitability.

The ledger conveniently organizes the money that your company spends and makes. You may think of these as notebooks where you record your business transactions as they happen. Then you put it all together in a master notebook called the general ledger. A few instances of this ledger are as follows:

  • Accounts receivable is a type of asset account that indicates how much money your company owes.
  • Accounts payable is a type of expense account that displays how much money your company owes to others.
  • Cash is a type of equity account that represents your company's liquid assets.
  • Inventory is a type of asset account that tracks the purchases and sales that have an impact on your company's inventory.

Why do you need it?

If you're considering creating your own general ledger, there are several compelling reasons to do so, even if you run a tiny firm. These are some of them:

  • It keeps an accurate record of your company's financial dealings.
  • It lets you create a trial balance to help you balance your books.
  • It's considerably easier to file tax returns when you have all of your business's income and expenses in one location.
  • It shows you your actual costs and income so you can keep track of your spending.
  • It assists you in quickly identifying odd transactions.
  • It assists you in detecting fraud and putting a stop to it straight away.
  • It assists in the preparation of crucial financial statements that are necessary for assessing the liquidity, profitability, and general financial health of your company.

Double-Entry Bookkeeping is the most popular accounting technique for smaller companies to employ in conjunction with a general ledger template. This is a way of handling daily transactions that includes error detection. Each commercial transaction is recorded twice:

When money is taken out of a bank account.
When money is deposited into a bank account.

You must first determine whether you will use the double-entry technique or the single-entry method before creating your financial ledger template. The second is rarely used and is better suited to simpler, smaller enterprises with a limited number of transactions each month.

It's highly probable that you'll hear the word "trial balance" a lot as you learn more about double-entry accounting. This is a double-entry bookkeeping-specific financial instrument. You must learn how to produce trial balances on a regular basis if you pick this sort of ledger.

Before you can prepare financial statements for a given accounting period, you must first prepare a trial balance to ensure that your accounting is error-free. A trial balance is used to calculate all of your credits and debits for an accounting period and ensure that they line up.

If you make a mistake, your books will become unbalanced. When this happens, you'll need to go back and revise your trial balance until it's accurate. After that, you may utilize it to create financial statements.

Remember that the trial balance isn't a financial report and isn't part of the ledger. Its purpose is to be used internally in the creation of business reports. Accountants and bookkeepers use the following formula:

Liabilities + Equity =  Assets

The total value of your assets should equal the total value of your equity and liabilities. If these aren't equal, your books are out of balance, and you'll need to make adjustments. The formula above is very basic yet very strong, and it will always apply regardless of the accounting technique you employ.

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