When a company holds a large number of notes receivable it sometimes sets up a controlling account and a subsidiary ledger for notes.

Question

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This statement is true. A controlling account and subsidiary ledger are often established to keep track of a large number of notes receivable. The controlling account summarizes the balances in the subsidiary ledger and is shown in the company's general ledger. The subsidiary ledger provides detailed information about each individual note receivable.

When a Company Holds a Large Number of Notes Receivable