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.
Endpoints
Chart of accounts
The Chart of Accounts (CoA) is the complete, ordered list of all ledger accounts a company uses to record its financial transactions. Think of it as the index: the Chart of Accounts names and organizes every account, while each ledger account holds the actual transaction records and balances.Structure
- Accounts are organized by code or numbering range.
- Can be hierarchical: main accounts with sub-accounts.
- Includes account type classifications: Asset, Liability, Equity, Revenue, Expense.
- Can be customized per folder while following the general framework.
Relationships
- Each folder has exactly one Chart of Accounts.
- The CoA contains all ledger accounts for that entity.
- It is the foundation for financial statements (balance sheet, P&L).