Subsidiary Ledgers Subsidiary Ledgers

Consolidating subsidiary accounts receivable ledger, wie daten ihre werbeerlebnisse verbessern

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Subsidiary ledger is an addition to and expansion of the general ledger. Rather than having multiple related accounts clogging up the main ledger system, a single subsidiary ledger can sum and report the totals of all related accounts with a single entry. The accounts of general ledger where detailed data of subsidiary ledgers are recorded briefly is called control accounts.

Ad The accounts receivable subsidiary ledger may be specific to each company in the business environment. Fourth, dividing subsidiary accounts into related sub-ledgers, multiple people can perform bookkeeping procedures.

The combined balance of every account in this subsidiary ledger equals the balance of accounts receivable in the general ledger. What Does Subsidiary Ledger Mean? Two common subsidiary ledgers: 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.

At a glance, it may seem like a lot of extra work to create and maintain subsidiary receivables accounts.

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In subsidiary ledgers individual ledger accounts are maintained in alphabetical order. As for example, detailed data of accounts receivable subsidiary ledger are transferred to accounts receivable briefly in general ledger. Example This sub ledger lists contains all of the account details for every credit customers including dates, balances, payments, and purchases made by each customer.

Explanation A subsidiary accounts receivable ledger -- or account -- is basically a list of clients who are in debt to your company. Other Benefits Another use for subsidiary receivable accounts is to aid in establishing a more beneficial demographic and target consumer.

You won't believe these 10 facts about people A standard accounting system typically uses a series of ledgers and journals to retain various pieces of information that relate to business transactions. Accounts payable subsidiary ledger is due where data relating to individual creditors are kept.

In some cases, certain information may be necessary in the accounts receivable subsidiary ledger as requested by a public accounting firm.

What is Accounts Receivable Subsidiary Ledger? definition and meaning

For example, an accounts receivable subsidiary ledger customers' subsidiary ledger includes a separate account for each customer who makes credit purchases. The accounts receivable subsidiary ledger retains specific information for each of these customers.

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Companies may have hundreds or even thousands of customers who purchase items on credit, who make one or more payments for those items, and who sometimes return items or purchase additional items before they finish paying for prior purchases. An accounts receivable subsidiary ledger is one such accounting book that falls under a control account.

The accounts receivable subsidiary ledger is essential to most businesses. Third, they help in error detection.


Recording all credit purchases, returns, and subsequent payments in a single account would make an individual customer's balance virtually impossible to calculate because the customer's transactions would be interspersed among thousands of other transactions.

In such cases, the company can track which customers owe them money, and for which job. Fraud Subsidiary accounts receivable ledgers are also an essential tool in detecting internal fraud and embezzlement.

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The relationship between the general ledger and subsidiary ledger is shown below through a chart. Bookkeepers use them to give a more detailed account of the credit extended to customers by your business.

What is a Subsidiary Ledger?

Accountants and bookkeepers can look through the sub if they want more details about individual customer accounts. Detail data of subsidiary ledger are accounted for in general ledger in brief.

For example, if a company has customers who owe money, each customer has an accounts receivable listing that indicates the current amount owed by the customer.

But the accounts receivable subsidiary ledger provides quick access to each customer's balance and account activity. In lieu of this system subsidiary ledgers are maintained to know amount receivable from an individual debtor and the amount payable to an individual creditor.

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First, it groups related accounts into one ledger that can be easily totaled and analyzed. At the end of an accounting period, the balance of every control accounts of general ledger becomes equal to the total of balances of individual accounts of related subsidiary ledger.

If each customer account was reported in the general ledger, there would be several hundred accounts receivable accounts to sift through when analyzing the main ledger.

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Companies can build them around information that best suits the needs of those reviewing this data.