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College Accounting (Book Only): A ...

13th Edition
Scott + 1 other
ISBN: 9781337280570

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BuyFindarrow_forward

College Accounting (Book Only): A ...

13th Edition
Scott + 1 other
ISBN: 9781337280570
Textbook Problem

Why is an accounts receivable ledger or an accounts payable ledger necessary for a business with large numbers of credit customers or large numbers of vendors/suppliers?

To determine

Explain the reasons for maintaining accounts receivable ledger or an accounts payable ledger prerequisite for a merchandising business with huge numbers of credit customers or huge numbers of vendors/suppliers.

Explanation

Accounts receivable: Accounts receivable refers to the amounts to be received within a short period from customers upon the sale of goods and services on account. In other words, accounts receivable are amounts customers owe to the business. Accounts receivable is an asset of a business.

A merchandising business has large number of customers and suppliers/vendors whose accounts cannot be maintained individually, which would result in overly long trial balance...

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