Which of the following is incorrect regarding subsidiary ledger? a. The accounts receivable ledger is a common subsidiary ledger b. An advantage of the subsidiary ledger is that it permits a division of labor in posting c. The purchases ledger is a common subsidiary ledger for creditor accounts d. A subsidiary ledger is a group of accounts with common characteristics

Which of the following is incorrect regarding subsidiary ledger? a. The accounts receivable ledger is a common subsidiary ledger b. An advantage of the subsidiary ledger is that it permits a division of labor in posting c. The purchases ledger is a common subsidiary ledger for creditor accounts d. A subsidiary ledger is a group of accounts with common characteristics

Accounting Information Systems

10th Edition

ISBN:9781337619202

Author:Hall, James A.

Publisher:Hall, James A.

Chapter5: The Expenditure Cycle Part I: Purchases And Cash Disbursements Procedures

Section: Chapter Questions

Problem 6MCQ

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Which one of the following statements is true? a. When a company uses a subsidiary ledger, the balance in the control account, Accounts Receivable, shows only the amount the company expects to collect from the accounts receivable, net of any expected uncollectible accounts. b. An accounts receivable subsidiary ledger represents amounts due to vendors and suppliers. c. The balance in the control account, Accounts Receivable, should be equal to the sum of the balances in the subsidiary ledger for accounts receivable. d. A subsidiary ledger takes the place of the control account for some companies.
Which of the following is true of the relationship between subsidiary ledgers and general ledger accounts?a. The two contain different and unrelated data.b. All general ledger accounts have subsidiaries.c. The relationship between the two provides an audit trail from the financial statements to the source documents.d. The total of subsidiary ledger accounts usually exceeds the total in the related general ledger account.
A subsidiary ledger is used for accounts receivable and accounts payable. Thus, transactions that are made “on account” are posted to the individual customer or creditor accounts.a. Why do companies use subsidiary ledgers for accounts payable and accounts receivable?b. Identify another account that could benefit from using a subsidiary ledger.
A subsidiary ledger that contains a separate account for each supplier (creditor) to the company is the a. Controlling account. b. Accounts payable ledger. c. Accounts receivable ledger. d. General ledger. e. Special journal.
A subsidiary ledger that contains a separate account for each supplier (creditor) to the company is the:
The Vendor Ledgers report displays the :Select one A. Accounts receivable control account B. Accounts Payable subsidiary ledger C. Accounts receivable subsidiary ledger D. Accounts Payable control account
Which of the following is not considered an important element of segregation of duties in the purchasing process: a) Separating thec heck signing and check mailing functions b) Separating the accounts payable and receiving functions c) Separating the purchasing function fromt he receiving function d) Separating the accounts payable and check signing functions
Why would a business maintain a separate account receivable account (within an accounts receivable subsidiary ledger) for each customer, as opposed to maintaining a single Accounts Receivable account (in the general ledger) for all customers?
Which of the following would not be used as a control account? a. Accounts receivable b. Accounts payable c. Plant and equipment d. Sales on account e. Inventory Please explain your answer
Why would a company use a subsidiary ledger for its Accounts Receivable?
What is the purpose of subsidiary ledgers? Select one: a. Provide supporting details on groups of accounts b. Provide credit balances only c. Provide supporting details on individual accounts d. Provide debit balances only
Which of the following statements is CORRECT relative to posting with the use of special journals? a. No subsidiary ledger posting is necessary. b. The general ledger posting has to coincide with the subsidiary ledger posting. c. The general ledger posting has to be ahead of subsidiary ledger posting. d. The subsidiary ledger posting has to be ahead of general ledger posting.