Question

In a computerized environment, what file is comparable to a subsidiary ledger used in manual accounting environments?

1) archive file
2) reference file
3) transaction file
4) master file

Answer 1

In computerized accounting, a master file is comparable to a subsidiary ledger as it contains detailed information for individual accounts.

Step-by-step explanation:

In a computerized environment, the file that is comparable to a subsidiary ledger used in manual accounting environments is the master file. A master file contains detailed data for individual accounts, much like a subsidiary ledger does in manual accounting systems. It serves as a central repository of up-to-date information, similar to how a subsidiary ledger offers detailed account information in addition to what is available in the general ledger. For example, in a computerized payroll system, the master file would contain all the details of each employee's payroll information, just as a subsidiary payroll ledger would in a manual system.

A subsidiary ledger contains detailed information about specific accounts, such as accounts payable or accounts receivable. Similarly, a master file in a computerized environment stores detailed information about specific entities, such as customers or vendors. For example, in an accounting software, a master file for customers would store information about each customer's name, contact details, payment terms, and transaction history. This file would be analogous to a subsidiary ledger for accounts receivable in a manual accounting system.