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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.
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