SUBSIDIARY LEDGER Definition

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SUBSIDIARY LEDGER is a group of subsidiary accounts the sum of the balances of which is equal to the balance of the related control account in the general ledger.

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COST IN EXCESS OF BILLINGS, in percentage of completion method, is when the billings on uncompleted contracts are less than the income earned to date. These under-billings result in increased assets. Conversely, where billings are greater than the income earned on uncompleted contracts, a liability, billings in excess of costs, results.

EARNING QUALITY is best determined through the inverse relationship between the amount of time elapsed between revenue recognition and cash collection.

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