Companies create subsidiary ledgers to divide accounting tasks and to reduce the size of the general ledger, while keeping up-to-date records of customers and suppliers. This process is also used to minimize errors in recording transactions.

Question

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Subsidiary ledgers are used to organize and manage detailed financial data separately from the general ledger, making it easier to track specific transactions with customers and suppliers, thereby reducing errors and keeping the general ledger more manageable.

Companies Create Subsidiary Ledgers to Divide Accounting Tasks and to Reduce