Misty Charnesky-Subsidiary Ledgers and Special Journals

Misty Charnesky-Subsidiary Ledgers and Special Journals -...

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Running head: SUBSIDIARY LEDGERS AND SPECIAL JOURNALS 1 Subsidiary Ledgers and Special Journals Misty Charnesky XACC280 August 18, 2011 Mark Bull
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SUBSIDIARY LEDGERS AND SPECIAL JOURNALS 2 Subsidiary Ledgers and Special Journals The four types of special journals are; sales journal, cash receipts journal, purchases journal, and cash payments journal. A sales journal is used to show the cost of goods and selling price, the advantages are easy and timesaving one-line entry, only totals are recorded, and reduces errors, one person can be responsible for the sales journal while someone else does another. A cash receipts journal records all receipts of cash, this shows a much more direct and visual display of debits and credits for the specified time period. In this way it is an advantage to a general ledger or subsidiary ledger because it combines the information into one easy to decipher chart. The purchases journal records all the merchandise purchases, this gives the advantage of seeing just how much money is spent on material alone and to whom it is paid to.
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Unformatted text preview: Cash payments journals record cash disbursements, the advantage is the ability to see whether the cash was paid out on materials, store or office supplies, or whether it a credit account. A subsidiary ledger is a group of accounts with characteristics in common, such as a customer or creditor; it is used to keep track of the individual balances. Control account is a summary of the more detailed subsidiary ledger and its purpose is to show the relation between the general ledger and subsidiary ledger. The two ledger accounts that may act as control accounts are accounts receivable and accounts payable. Some advantages of subsidiary ledgers are; 1. Show single account transactions affecting only one customer or creditor, 2. Free general ledger of excessive details, 3. Help locate errors in individual accounts, 4. Make division of labor possible. SUBSIDIARY LEDGERS AND SPECIAL JOURNALS 3 Reference Stormo, D. D. (2008). Subsidiary Ledgers and Special Journals . Na: www.wiley.com....
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Misty Charnesky-Subsidiary Ledgers and Special Journals -...

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