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Chapter 9
Accounting Information Systems
The subsidiary ledger tracks each customer and the amount owing, while the accounts receivable
control account simply shows the total amount of $1,500. It is important to note that we do not
post amounts from the subledger to the general ledger. Subledgers simply keep a record of detailed
information about specific general ledger accounts. All amounts in the general ledger are posted
from either the special journal or the general journal.
At the end of a period, the total of the subledger accounts is compared with their respective control
account balance. If the sum of the individual ledger accounts is not equal to the control account, an
error has occurred and must be corrected.
Just as the accounts receivable subsidiary ledger ensures customer amounts to collect are properly
recorded, the accounts payable subsidiary ledger ensures supplier amounts owed are properly
recorded. For example, a manager may want to know how much product was purchased from
a particular supplier, over which time period, when it was paid for, what discounts were allowed
for early payment, etc. To have easy access to this information, an individual ledger is maintained
for each supplier.The ledger, which records the activities for each individual supplier, is called the
accounts payable subsidiary ledger. The total of all the closing balances for each account in the
accounts payable subsidiary ledger must be equal to the accounts payable general ledger balance.
The relationship between the general ledger and the subledger is demonstrated in Figure 9.2 and
Figure 9.3.
Subsidiary Ledger
Accounts Payable Subsidiary Ledger
Sellmore Advertising Agency
DATE PR
DR
CR
BALANCE
(DR or CR)
O/B
4,600
CR
Apr 1
4,600
0
Apr 12
4,600
4,600
CR
ABC Prize Supply Store
DATE PR
DR
CR
BALANCE
(DR or CR)
Apr 12
500
500
CR
Sparkies Computer Repairs
DATE PR
DR
CR
BALANCE
(DR or CR)
Apr 8
400
400
CR
Apr 12
100
300
CR
Figure 9.2
Control Account
General Ledger
Accounts Payable
DATE PR
DR
CR
BALANCE
Apr 12
5,400
5,400
A subsidiary ledger is a group of accounts.
The total of the subsidiary ledger accounts
is equal to the control account.
Sellmore
$4,600
ABC Prize
$500
Sparkies
$300
Accounts Payable
$5,400
