Receivables (Sales) Ledger

A receivables ledger holds account details for customers who buy on credit - this account will have details of any sales made to them on credit plus any goods returned and payments received. The balance of this account shows how much the customer owes the business.

In accounting terms a customer who buys on credit is known as a receivable or trade receivable hence the name of the ledger.

The receivables ledger is known as a subsidiary ledger as it provides a record of individual amounts owed by each trade receivable. The total of these accounts should always equal the total amount of the receivables ledger control account.