A subsidiary ledger is a ledger that includes all of the details of a general ledger, and it holds accounts with similar attributes. The purpose is that is can contain things such as accounts receivable and accounts payable and it can show the sum total. The advantages of using subsidiary ledgers is that the sum of all the accounts is kept in the General Ledger and all of the details of the accounts are kept in the subsidiary ledger which is separate so you can keep them in different columns so to not get confused. A control account is an account that contains the total number of sales/purchases made. If you add up all of the individual accounts it should equal the control account, also known as a summary of the account. The purpose of a control account is that it doesn’t have to contain all of the details but it will have all of the financial information organized accurately. The accounts receivable and accounts payable ledgers are two general ledger accounts that act as control accounts for a subsidiary ledger. Cash receipts journal, cash payments journal, sales journal, and the purchase journal are the four different special journals of accounting. The advantages of all the journals are that transactions that occur on a daily basis can be put into a specific journal and one person can be in charge of that journal. All of the information can be tracked in one place which can make the work much easier as well. A cash payments journal can be used with any company that deals primarily with cash which is most companies. A cash receipts journal is sometimes used for the sales of a product to help track transactions. Purchase journals are used with companies that make a lot of purchases on one account while sales journals are for companies that perform purchases. The sales journal posts the sum on the general ledger at the end of the pay period/month.
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