Definition
A ledger account is a single entry within the Chart of Accounts. It tracks one specific category of financial activity — for example “Rent expense”, “Cash”, or “Accounts receivable”. Every debit and credit line in a journal entry references a ledger account. This is how all transactions are classified and how balances accumulate.Structure
Each ledger account has:- An account code (e.g.
610) - A name and optional description
- An account type: Asset, Liability, Equity, Revenue, or Expense
- A running balance updated by each journal entry that references it
Relationships
- Belongs to the Chart of Accounts of a specific folder.
- Referenced by journal entry lines (debit and credit sides).
- Referenced by invoice lines, which generate journal entries behind the scenes.
- Partners can have default ledger accounts for automatic posting.