Discuss the customer have to pay for the services or product

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What are the two common subsidiary ledgers? Please describe.

My answer:

Accounting to our text (Kieso, Kimmel & Weygandt, 2015). We have learn of two ledger common accounts

1. Accounts Receivable - When the customer have to pay for the services or product they received from that company. This is an asset to that company

2. Accounts Payable - When a company buy something for credit from a lender, such as a supplier for goods or services.

Suppose Company Xretailsproducts to Company Yfor a creditfor no more than a 60day period. Therefore company X will record a sale and will also record this as an account receivable. Company Y will record the purchaseand will also record it to an account payable.

However, look at it this way "There is always another side to every transaction." Nowaccounting should believein evenness: Company X has a sale and a receivable, Company Y has a purchase and a payable.

Reference no: EM131792591

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