Home For AAT student members AQ 2013 AAT Level 2 (Level 5 in Scotland)

definitions of account types

Sarah1910Sarah1910 New MemberRegistered Posts: 9
Please please please can someone explain these different accounts for me.

I thought I had it sussed then got myself all in a muddle and totally confused as to what is what and what goes where!

I understand that businesses use a Nominal or Main ledger and that things bought or sold on credit get listed in the Subsidary (sales or purchases) ledger. But where do I use the following;

Sales/purchases ledger control

Debtors/ Creditors control

Debtors /Creditors ledger

I have looked over and over the books and seem to be getting more confused.

Panicking now as only 1 month til exam!

Sarah :confused1:


  • sarahwilsonsarahwilson Experienced Mentor Registered Posts: 567
    I got in a real muddle too last year so hopefully I can help you.

    You have subsidiary detor and creditor accounts showing how much is owed by or to by each customer and supplier. How are you going to work out how much in total you owe to all your suppliers? The only way is to go through each account and add up the balances unless you have a control account. The control account has all information relating to the relevant ledger in one place meaning you can easily see how much is owed at any one time.
  • welshwizardwelshwizard Trusted Regular South WalesRegistered Posts: 465
    The Sales ledger (does not form part of double entry) and is just a group of Memorandum Accounts showing you who owes what and what credit transactions have taken place where - information for these comes directly from individual transactions in the books of original/prime entry - the Sales Day Book and Sales Returns Day Book.

    The Sales Control account (Debtors Control) is used to summarise the totals of transactions from all sales ledger accounts - this control account is found in the Main/General/Nominal Ledger and does form part of the Double Entry system - figures here come from the Column total in the Sales Day Book (Gross Total of invoices issued), Sales Returns Day Book (Gross Total of Credit Notes issued) and Cash Book - Receipts (also includes Discounts Allowed)

    Obviously this can be adapted to be used on the other sides of the ledgers with purchases..
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