Why is Ledger Known As The Principal Book of Accounts

Ledger is known as the Principal Books of Accounts as it is the basis for the preparation of Financial Statements e.g., Income Statement, Balance Sheet, Statement of Retained Earnings And Cash Flows Statement.

Also, all the accounts are finally transferred to concerned ledgers accounts separately in a classified form.

Any errors, mistakes or frauds reported in the financial statement are easily prevented, detected and corrected wit the help of concerned ledger’s accounts.