What is Cost Ledger Accounting?

Under this method separate set of cost accounts have to be maintained so as to derive cost details. It will differ from general financial accounting system adopted in the organization. Hence, it requires two separate set of accounts. It can be called inter-locking system. Under cost Ledger Accounting the books are kept only for the impersonal accounts. To make this system self-balancing certain set of control accounts have to be prepared.

As in the case of general accounting system, transactions relating to factory operations which are ultimately reflected in the cost accounts are recorded in the books of original entry. Summaries from these books are journalized and posted in the general ledger which contains control accounts and subsidiary books.