Definition of a Ledger
A ledger is often defined as a book of accounts. Today the ledger and its accounts are likely to be an electronic record or file.
Example of a Ledger
An example of a ledger is a company's general ledger, which contains all of its asset, liability, owner equity, revenue, expense, gain, and loss accounts. Each account contains the transaction amounts that pertain to the account title.
Definition of a Trial Balance
A trial balance is a listing of the account names and their balances from the general ledger. The debit balance amounts are in one column and the credit balance amounts are in the adjacent column. (Usually accounts with zero balances are not listed.) If the totals of the two columns are equal, accountants are comforted in knowing that the general ledger has its debits equal to credits. The trial balance is an internal accounting report that merely documents the equality of debits and credits. It is not a financial statement.
The trial balance was crucial internal report when the accounting records were maintained and updated manually. With a manual system, part of an entry may have been omitted, one of the transaction amounts may have had digits transposed, math errors may have occurred when calculating an account's balance, etc. Today's accounting software is coded to prevent these types of errors. As a result, it is rare to see a computerized trial balance that does not have the total amount of debits equal to the total amount of credits.
