- This topic has 3 replies, 2 voices, and was last updated 3 months ago by Ken Garrett.
- August 3, 2020 at 3:12 pm #579082accountguy
I have been seaching for the difference b/w general ledger & general ledger control account but nowhere I could find the answer that can be satisfied. Are these the same things?
I know that control accounts are made where the transactions are in great numbers to avoid any duplication or error but why general ledgers are made then?? Confused!!!
Secondly, please try it explain to me how the entries are submitted in both the General ledger & subsidiary ledgers why these two are made by the company.August 4, 2020 at 1:26 pm #579195Ken GarrettKeymaster
The general, or nominal, ledger contains details of assets, liabilities, income amd expenses. Eg cost of motor vehicles, sharemcapital, sales and heating costs. It also contains the sales ledger control account (or total receivables account) and the purchase ledger control account (or total payables account). Often the general ledger will also have a cash control account. If so, a complete trial balance can be extracted from the general ledger.
However, because cash, receivables and payables are very ‘busy’ amounts, information is also held i(e duplicated) in the receivables ledger, the payables ledver and the cash book. Eg the receivables ledger has an account for each credit customer showing what each owes. The control account does not hold that detail – just the total of receivables.
Other than the sales ledger control account, the purchase pedger control account and the cash control account (duplicating in summarised for the cash book) we do not know of a separate nominal ledger control account.August 4, 2020 at 2:29 pm #579202accountguy
Thanks for the answer!
Sir could you please confirm what you are saying is that control account only consist of totals while the ledgers are individual accounts made for each receivable, payables, & cash for customers/suppliers?August 4, 2020 at 3:49 pm #579210Ken GarrettKeymaster
Yes. It is easier to understand if instead of using the term ‘control account’ you use ‘total account’.
The cash control account exactly mirrors the entries in the cash book. The cash book credit entries are likely to be analysed across several columns in the cash book. The cash control account would simply record the total of all the cash outgoings.
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