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Why the balance in account receivable control account may not agree with the total in the account receivable ledger?
The balance in the accounts receivable control account may not agree with the total in the accounts receivable ledger due to timing differences, such as transactions recorded in one but not the other. Errors in data entry, such as incorrect postings or omissions, can also lead to discrepancies. Additionally, adjustments or write-offs that haven't been reflected in both accounts may cause imbalances. Regular reconciliation is essential to identify and correct these discrepancies.
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The cash account in the depositor's ledger is a?
In the depositor's ledger, its cash account is an asset with a debit balance. Account assets also includes accounts receivable and inventories.
Where does the sum of customers' unpaid balances that is compared to the general ledger balance comes from?
The sum of customers unpaid balance or balance of account receivables in the General Ledger usually comes from a subsidiary ledger which contains an individual account receivable for each customer, the total of these accounts are summed and placed in one single account in the "general ledger".
What is sales ledger control account?
Sales control account is a summary of transactions relating to the debtors balance.the debtors ledger account is debited when there is an increase of the debtors balance and credited when there is a reduction of the debtors balance
Would a credit entry to the accounts receivable ledger account would make the balance decrease?
Yes, a credit entry to the accounts receivable ledger account would decrease the balance. In accounting, accounts receivable represents amounts owed to a business, and a credit reduces this asset account. Thus, when a payment is received from a customer or an adjustment is made, a credit entry reflects a decrease in the total amount owed to the business.
Why do we have credit balance on the sales ledger control account?
A credit balance on the sales ledger control account typically indicates that a business has overpaid its customers or that there are unallocated payments or credits on the account. This can occur due to reasons such as customer returns, discounts applied, or prepayments made by customers. It may also suggest that the business needs to review its accounts receivable for any discrepancies or errors. Proper management of the sales ledger ensures accurate tracking of customer balances and financial health.
How is subsidiary ledger different to the general ledger?
A subsidiary ledger is a group of similar accounts whose combined balances equal the balance in a specific general ledger account. The general ledger account that summarizes a subsidiary ledger's account balances is called a control account or master account. For example, an accounts receivable subsidiary ledger (customers' subsidiary ledger) includes a separate account for each customer who makes credit purchases. The combined balance of every account in this subsidiary ledger equals the balance of accounts receivable in the general ledger. Posting a debit or credit to a subsidiary ledger account and also to a general ledger control account does not violate the rule that total debit and credit entries must balance because subsidiary ledger accounts are not part of the general ledger; they are supplemental accounts that provide the detail to support the balance in a control account.
Why are control account balances reported in external financial statements while subsidiary account balances are not?
A control account is a summary account in the general ledger. The details that support the balance in the summary account are contained in a subsidiary ledger-a ledger outside of the general ledger. The purpose of the control account is to keep the general ledger free of details, yet have the correct balance for the financial statements. For example, the Accounts Receivable account in the general ledger could be a control account. If it were a control account, the company would merely update the account with a few amounts, such as total collections for the day, total sales on account for the day, total returns and allowances for the day, etc. The details on each customer and each transaction would not be recorded in the Accounts Receivable control account in the general ledger. Rather, these details of the accounts receivable activity will be in the Accounts Receivable Subsidiary Ledger. This works well because the employees working with the general ledger probably do not need to see the details for every sale or every collection transaction. However, the sales manager and the credit manager will need to know detailed information on individual customers, including whether a customer recently reduced their account balance. The company can provide these individuals with access to the Accounts Receivable Subsidiary Ledger and can keep the general ledger free of a tremendous amount of detail. Sourced: http://blog.accountingcoach.com/accounts-receivable-control-account-subsidiary-ledger/ (second result after googling "Control account balances and Subsidiary account balances" ps: lrn2google)
The cash account in the depositor's ledger is a?
In the depositor's ledger, its cash account is an asset with a debit balance. Account assets also includes accounts receivable and inventories.
What is guest ledger?
A subsidiary ledger related to the accounts receivable general ledger account used by hotels to record the individual account activity of guests who are still at the hotel. The total of the balances in the city ledger plus the total of the balances in the guest ledger should equal the balance in the accounts receivable general ledger account.
Where does the sum of customers' unpaid balances that is compared to the general ledger balance comes from?
The sum of customers unpaid balance or balance of account receivables in the General Ledger usually comes from a subsidiary ledger which contains an individual account receivable for each customer, the total of these accounts are summed and placed in one single account in the "general ledger".
What is sales ledger control account?
Sales control account is a summary of transactions relating to the debtors balance.the debtors ledger account is debited when there is an increase of the debtors balance and credited when there is a reduction of the debtors balance
Would a credit entry to the accounts receivable ledger account would make the balance decrease?
Yes, a credit entry to the accounts receivable ledger account would decrease the balance. In accounting, accounts receivable represents amounts owed to a business, and a credit reduces this asset account. Thus, when a payment is received from a customer or an adjustment is made, a credit entry reflects a decrease in the total amount owed to the business.
When does the AP requires a subsidiary ledger?
A control account is an account found in the general ledger such as accounts receivable,Accounts Payable,inventory etc. The accounts are a summation of entries made in the subsidiary ledgers and are.When using a General Ledger, accounts such as Accounts Payable or Accounts Receivable are much easier to work with in the General Ledger if they have a "single" sum of all accounts, in other words.
Why do we have credit balance on the sales ledger control account?
A credit balance on the sales ledger control account typically indicates that a business has overpaid its customers or that there are unallocated payments or credits on the account. This can occur due to reasons such as customer returns, discounts applied, or prepayments made by customers. It may also suggest that the business needs to review its accounts receivable for any discrepancies or errors. Proper management of the sales ledger ensures accurate tracking of customer balances and financial health.
When The AP ledger requires a subsidiary ledger?
A control account is an account found in the general ledger such as accounts receivable,Accounts Payable,inventory etc. The accounts are a summation of entries made in the subsidiary ledgers and are.When using a General Ledger, accounts such as Accounts Payable or Accounts Receivable are much easier to work with in the General Ledger if they have a "single" sum of all accounts, in other words.
Four main ledgers for bookkeeping in business?
The General Ledger The Account receivable Ledger The Accounts payable Ledger
Why is the accounts receivable subsidiary ledger organized in alphabetical ordee?
The Accounts receivable subsidiary ledger or any other subsidiary ledger can be in the form of a card file, a binder notebook, a formal, pre-printed ledger page, or computer files. It will not have page numbers, but each account may have a unique number to help identify it. The accounts receivable subsidiary ledger is organized alphabetically by customer name and address; new customers can be added and inactive customers deleted, once the balance in their account is zero. To make ease in journalizing process, the accounts receivable subsidiary ledger are organized in alphabetical order.
