The Sales Ledger is frequently in software known as "Accounts Receivable" or "Customer Accounts".
The Sales Ledger is your record of sales, and whether or not you have received the money, and how much you are still owed.
On the Balance Sheet
the total amount still owed to you by Customers
will usually be called "Trade Debtors"
or “Accounts Receivable”
The Sales Ledger
has an Account
for every Customer
. Each such Customer Account
carries all the transactions
for the one Customer
, these are:
• Sales Invoices
• Sales Credit Notes
• Payments Received
In Accounting Software
, by recording these three types of transactions, you will get an immediate calculation of the money owed to you.
The accounting software will also allow you to allocate
the money received
to the sales invoice
it relates to. These transactions
are then regarded as cleared
If you run an open items
or unpaid invoices
report, you will see just the unpaid invoices
, rather than all the previous paid invoices, which is usually a much bigger report and not frequently needed.
If trading is healthy, many of the Customer Accounts
will be carrying balances
at any given time, hopefully just the most recent unpaid sales invoices.
As with all Accounts
, the transactions
will be recorded as Debits and Credits
To make the accounting records complete, the Sales Ledger
has to be 'represented' in the General Ledger
, even though they themselves are separate ledgers.
This is achieved by the concept of Control Accounts
. On the General Ledger
there will be a Control Account
for the Sales Ledger
Every time a transaction
is recorded in the Sales Ledger
(eg. Sales Invoice), an identical record
is kept in the Sales Ledger Control Account
on the General Ledger
. This is the way that the General Ledger
stays in balance
Please read the section on Accounting Controls for checks you can make on the Sales Ledger.