Ledger Balance


DEFINITION of 'Ledger Balance'

The balance of a customer account as shown on the bank statement. The ledger balance is found by subtracting the total number of debits from the total number of credits for a given accounting period. The ledger balance is used solely in the reconciliation of book balances.

BREAKING DOWN 'Ledger Balance'

The ledger balance should not be confused with the customer's available balance, which is the amount of funds available for withdrawal. The ledger balance includes any and all checks outstanding that have not yet cleared the account. This is partly why it differs from the available balance.

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  1. How do you calculate credits and debits in the general ledger?

    A general ledger acts as a record of all accounts and their transactions. Balancing the ledger involves subtracting the total ... Read Full Answer >>
  2. Can working capital be depreciated?

    Working capital as current assets cannot be depreciated the way long-term, fixed assets are. In accounting, depreciation ... Read Full Answer >>
  3. Do working capital funds expire?

    While working capital funds do not expire, the working capital figure does change over time. This is because it is calculated ... Read Full Answer >>
  4. How much working capital does a small business need?

    The amount of working capital a small business needs to run smoothly depends largely on the type of business, its operating ... Read Full Answer >>
  5. What does high working capital say about a company's financial prospects?

    If a company has high working capital, it has more than enough liquid funds to meet its short-term obligations. Working capital, ... Read Full Answer >>
  6. How can working capital affect a company's finances?

    Working capital, or total current assets minus total current liabilities, can affect a company's longer-term investment effectiveness ... Read Full Answer >>

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