At the End of the Month, the Accountant for Slater

question 200

Essay

At the end of the month, the accountant for Slater Company prepared a schedule of accounts receivable from the accounts receivable subsidiary ledger. Its total did not agree with the balance in the Accounts Receivable control account in the general ledger. Briefly describe the procedure that should be followed in reconciling the two balances.

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Definitions:

Financial Statements

Reports that summarize the financial performance, position, and cash flows of a business over a specific period.

Indirect Method

A way to prepare cash flow statements where net income is adjusted for non-cash expenses, changes in working capital, and non-operating cash flows to calculate cash flow from operating activities.

Operating Activities

The day-to-day functions of a business related to producing and selling its goods or services, which are reflected in its cash flow.

Investing Activity

Transactions and events that involve the purchase and/or sale of long-term assets and other investments, as shown in a company’s cash flow statement.