Bookkeeping Ledger Flashcards

What is the purpose of a subsidiary ledger?

Answer: To provide detailed records supporting a control account

A subsidiary ledger contains detailed records for individual accounts that are summarized in a corresponding control account in the general ledger.

Which account in the general ledger corresponds to the accounts receivable subsidiary ledger?

Answer: Accounts Receivable control account

The Accounts Receivable control account in the general ledger must equal the total of all individual customer balances in the accounts receivable subsidiary ledger.

When is a ledger account said to have a 'zero balance'?

Answer: When total debits equal total credits

A ledger account has a zero balance when the sum of all debit entries equals the sum of all credit entries, resulting in no net balance.

In a standard T-account, where are credit entries recorded?

Answer: Right side

Credit entries are always recorded on the right side of a T-account, while debit entries are recorded on the left side.

What does 'posting' mean in bookkeeping?

Answer: Transferring journal entry amounts to ledger accounts

Posting is the process of transferring debit and credit amounts from journal entries to the corresponding accounts in the general ledger.

Which of the following best describes a 'running balance' ledger format?

Answer: A ledger with separate debit, credit, and balance columns updated after each entry

A running balance ledger (also called the balance-column format) shows the current account balance after each transaction is posted.

If the accounts payable subsidiary ledger totals $15,000, what should the Accounts Payable control account balance be?

Answer: $15,000

The Accounts Payable control account must always equal the total of all individual vendor balances in the accounts payable subsidiary ledger.