What is Sub-Ledger

A sub ledger is a ledger containing all a detailed sub-set of transactions. The total of the transactions in the sub ledger roll up into the general ledger. For example, a sub ledger may contain all accounts receivable, or accounts payable, or fixed asset transactions. Depending on the type of sub ledger, it might contain information about transaction dates, descriptions, and amounts billed, paid, or received. A summary-level entry is periodically recorded in the general ledger. If someone is researching information in the general ledger in an account that contains this summarized level of information, he or she must then access the sub ledger to review transaction-specific information.

As part of their year-end tests, auditors may trace transactions from a sub ledger to the general ledger and from there to the financial statements, to ensure that transactions are being recorded properly in the accounting system.

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Procure to Pay (P2P) Process Folow with Journal Entries

Procure to Pay process flow. 1. Requester: Request for goods & the same goes for an approval 2. PR is created & routed for approval 3. Once approved, PO is created. 4. Sourcing activities like, Choosing the right Vendor, Payment info happens meanwhile, 5. PO is routed for approval 6. PO is sent to the supplier.& Vendor signs the agreement (Payment terms) 7. Supplier will send the goods along with Invoice.(PO Number mentioned) 8. Good received & GRN entry is made. 9. Invoice is sent to the AP team 10. AP team process the Invoice (3 way match) - GL coding will be automatically pulled. 11. process for Payment Few Journal Entries examples are as followed. 1. Goods Received Ware House Dr Inventory a/c Cr GRNI a/c 2. Inv. Regis...

Intercompany Eliminations with Journal Entries

Intercompany Eliminations Explained intercompany eliminations happen for business combinations. The whole thing kind of confuses me. Can you explain the process and the journal entries to record the intercompany eliminations? Answer: Remember that in a business combination, we are trying to eliminate any transactions between the parent and the subsidiary so that we only have transactions with 3rd parties left after our consolidating entries. So, let’s assume Company A owns Company B and A sells $120,000 of inventory to B. Let’s also assume that Company A gets a 40% margin on all sales and Company B has 30% of the inventory remaining at the end of the year. With this set of facts, they could ask you a wide variety of questions on the CPA exam. One of the tricks to solving problems involving intercompany eliminations is to understand the entries that A and B would book in these cases. One of the other tricks is understanding the relationship between cost and margin percentage. ...

Journal Entries for Record to Report (R2R)

Journal Entry Examples Entity A had the following transactions in December 2xx1: 1. December 2, Owner P created a new Entity B and invested $140,000 in cash. 2. December 9, Entity B borrowed $80,000 from a bank. 3. December 11, Entity B purchased 3,000 units of merchandise at $10 per unit in cash. 4. December 18, Entity B purchased equipment and paid $70,000 in cash. 1. Investment by owner December 2, Owner P created a new Entity B and invested $140,000 in cash. Debit Credit Cash 140,000 Owner's equity 140,000 [Note] Debit: Increase in cash (asset) Credit: Increase in owner's equity (equity) 2. Borrowings from a bank December 9, Entity B borrowed $80,000 from a bank. Debit Credit Cash 80,...

Accounting

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