Question

What makes the ledger a “book of final entry”?

Options

• It records transactions chronologically.

• It provides a classified summary of all accounts.

• It includes narrations for each transaction.

• It includes source documents for all entries.

Answer 1

It provides a classified summary of all accounts.

Explanation:

The ledger is called the “book of final entry” because all transactions that are first recorded chronologically in the journal (book of original entry) are then classified and posted account-wise into the ledger. This classification provides a systematic summary of all accounts, showing the net effect of all transactions on each account.