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Ledger accounts and the division of the ledger

The document explains the structure of ledger accounts in a manual accounting system, highlighting the general ledger, accounts receivable ledger, and accounts payable ledger. It details how each ledger serves to track financial information and the role of control accounts within the general ledger. Additionally, it notes that only one of the individual accounts or control accounts can be part of the double entry system, typically the control accounts.

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4 views

Ledger accounts and the division of the ledger

The document explains the structure of ledger accounts in a manual accounting system, highlighting the general ledger, accounts receivable ledger, and accounts payable ledger. It details how each ledger serves to track financial information and the role of control accounts within the general ledger. Additionally, it notes that only one of the individual accounts or control accounts can be part of the double entry system, typically the control accounts.

Uploaded by

mirzatahrema
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Ledger accounts and division of the ledger

In a manual system, ledgers can be thought of as books containing the individual


accounts:

 The general ledger contains all accounts or a summary of all accounts necessary
to produce the trial balance and financial statements.

 The accounts receivable ledger contains an account for each credit customer to
show how much each one owes.
An account to summarise this information, the receivables control account, is
normally contained within the general ledger.

 The accounts payable ledger contains an account for each credit supplier to
show how much they are owed.
An account to summarise this information, the payables control account, is
normally contained within the general ledger.

Where there are individual accounts in a receivables or payables ledger AND a control
account in the general ledger, only one can form part of the double entry system. The
other exists for memorandum purposes. It is normally the case that the control accounts
form part of the double entry.

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