Which of the following is true of an accounts receivable subsidiary ledger?
A)It does not include a receivable account for each customer,but includes a cumulative account for all customers.
B)It contains information about the amount each customer purchased on credit,but excludes the customer name.
C)The total of the accounts in the accounts receivable subsidiary ledger must equal the accounts receivable balance in the general ledger.
D)Companies keep an accounts payable subsidiary ledger that is entirely different from the accounts receivable subsidiary ledger.

Question

Quizplus · Accepted Answer

The purpose of an accounts receivable subsidiary ledger is to provide detailed information about individual customer balances. The total of the accounts in the subsidiary ledger must equal the accounts receivable balance in the general ledger to ensure accuracy of the overall accounts receivable balance. Option A is incorrect because each customer should have a separate account in the subsidiary ledger. Option B is incorrect because the customer name is a necessary piece of information in the subsidiary ledger. Option D is incorrect because an accounts receivable subsidiary ledger typically includes information about customer balances, while an accounts payable subsidiary ledger contains information about amounts owed to vendors.

Which of the Following Is True of an Accounts Receivable