How Is A Subsidiary Ledger Different From Accounts Receivable Ledger?

How is a subsidiary ledger different from accounts receivable ledger? A subsidiary ledger is a group of similar accounts whose combined balances equal the balance in a specific general ledger account. For example, an accounts receivable subsidiary ledger (customers' subsidiary ledger) includes a separate account for each customer who makes credit purchases.

Which accounts have subsidiary ledger aside from accounts receivable?

Examples of subsidiary ledgers are:

  • Accounts payable ledger.
  • Accounts receivable ledger.
  • Fixed assets ledger.
  • Inventory ledger.
  • Purchases ledger.
  • Which document is used by the AR department to post to the AR subsidiary ledger?

    The primary document recorded in the accounts receivable ledger is the customer invoice. Also, if you grant a credit back to a customer for such items as returned goods or items damaged in transit, then you also record a credit memo in the ledger.

    What is a subsidiary ledger What are the advantages of using subsidiary ledgers?

    The advantages of using subsidiary ledgers are that they: Permit transactions affecting a single customer or single creditor to be shown in a single account, thus providing necessary up-to-date information on specific account balances.

    What is the purpose of a subsidiary ledger?

    A subledger or subsidiary ledger provides the details that make up the balance of specific general ledger accounts. Because general ledger accounts only provide an ending balance for each particular account, a subsidiary ledger is used to provide the details that result in that general ledger balance.

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    What is a subsidiary ledger in accounts payable?

    An accounts payable subsidiary ledger is an accounting ledger that shows the transaction history and amounts owed to each supplier and vendor. The subsidiary ledger records all of the accounts payables that a company owes.

    What information is available in the subsidiary ledgers?

    A subsidiary ledger contains the details to support a general ledger control account. For instance, the subsidiary ledger for accounts receivable contains the information for each of the company's credit sales to customers, each customer's remittance, return of merchandise, discounts, and so on.

    How do you post accounts receivable?

  • Under Manage Records, click the Transactions tab.
  • In the drop-down list, select Accounts Receivable Payments, then click Go .
  • Click Post Payments.
  • To post payments in separate batches, select Select Payment Types and click Select to select the payment types you want to post.

  • What is receivable control account?

    In accounting, the controlling account (also known as an adjustment or control account) is an account in the general ledger for which a corresponding subsidiary ledger has been created. For example, "accounts receivable" is the controlling account for the accounts receivable subsidiary ledger.

    Why are subsidiary accounts important?

    Subsidiary ledgers are very important in the accounting world and in the overall language. Subsidiary ledgers provides detail information on financials things such as purchases or sales. It records specific transactions that go down in a business.

    What is the relevance of having subsidiary ledgers Aside from control accounts?

    The subsidiary ledger provides an opportunity to better monitor the individual transactions of a particular controlling general ledger account. Control accounts commonly supported by subsidiary ledgers include the accounts receivable and accounts payable accounts.

    What is the types of subsidiary account?

    We can divide the subsidiary books into the following types:

    Purchases return or return outwards book. Sales return or return inwards book. Bills receivable book. Bills payable book.

    Is a debtors ledger a subsidiary ledger?

    The debtors' subsidiary ledger is a sub-system in the overall accounting system. It maintains an account for each debtor and records detailed information (not totals) about debtors from the sales journal and cash receipts journal.

    Which document serve as a subsidiary ledger for the general ledger balance of work in process inventory?

    The job cost sheets make up the subsidiary ledger for the Work in Process Inventory account.

    Why do you think general ledger and subsidiary ledgers are important in recording business transactions?

    The general ledger includes information that does not meet the specific requirements of subsidiary ledgers. However, companies prefer to use subsidiary ledgers when recording financial transactions to limit the amount of detailed information in the general ledger.

    Why would a company maintain separate accounts receivable ledgers for each customer?

    The company can make the separate accounts for every individual accounts receivable because it is ensuring that the company can make the separate accounts for every individual accounts receivable because company can easily identify or find how much the individual customer owes the amount, easy to find the defaulter.

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