Which of the following statements is INCORRECT?1. Under self-balancing

1.	Which of the following statements is INCORRECT?1. Under self-balancing ledger system, only two ledger accounts are prepared (Debtors Ledger and Nominal Ledger).2. Under self-balancing ledger system, a complete trial balance can also be prepared by taking up the balances of ledger accounts.3. Debtors Ledger is also known as Sold Ledger or Sales Ledger, which is maintained for recording personal accounts of trade debtors.4. Under self-balancing ledger system, each ledger is prepared under double entry system.
Answer» Correct Answer - Option 1 : Under self-balancing ledger system, only two ledger accounts are prepared (Debtors Ledger and Nominal Ledger). The incorrect answer is Under the self-balancing ledger system, only two ledger accounts are prepared (Debtors Ledger and Nominal Ledger). Self-Balancing Ledger: All the ledger accounts are prepared from the balances extracted from the trial balance. Under a double-entry system of accounting, each ledger is self-balancing. Under self-balancing ledgers, as all the ledgers are prepared using the double-entry system, so a trial balance can be prepared with the Debtor's or Creditor's ledger balances. So, Option 2 is also contextually correct. Under self-balancing ledgers, Debtors Ledger is also known as Sold Ledger or Sales Ledger, which records all the transactions related to customers to whom goods have been sold on credit. Therefore, Option 3 is also contextually correct. Under the self-balancing ledger system, each ledger is prepared under the double-entry system. For each transaction, there shall be a debit entry and simultaneous credit entry. Therefore, Option 4 is also contextually correct. Under self-balancing ledger system, three ledger accounts are prepared namely Debtors Ledger, Creditor's Ledger and Nominal Ledger. So, option 1 contains an INCORRECT statement.

Which of the following statements is INCORRECT?1. Under self-balancing ledger system, only two ledger accounts are prepared (Debtors Ledger and Nominal Ledger).2. Under self-balancing ledger system, a complete trial balance can also be prepared by taking up the balances of ledger accounts.3. Debtors Ledger is also known as Sold Ledger or Sales Ledger, which is maintained for recording personal accounts of trade debtors.4. Under self-balancing ledger system, each ledger is prepared under double entry system.

Answer» Correct Answer - Option 1 : Under self-balancing ledger system, only two ledger accounts are prepared (Debtors Ledger and Nominal Ledger).

The incorrect answer is Under the self-balancing ledger system, only two ledger accounts are prepared (Debtors Ledger and Nominal Ledger).

Self-Balancing Ledger: All the ledger accounts are prepared from the balances extracted from the trial balance. Under a double-entry system of accounting, each ledger is self-balancing.

Under self-balancing ledgers, as all the ledgers are prepared using the double-entry system, so a trial balance can be prepared with the Debtor's or Creditor's ledger balances. So, Option 2 is also contextually correct.
Under self-balancing ledgers, Debtors Ledger is also known as Sold Ledger or Sales Ledger, which records all the transactions related to customers to whom goods have been sold on credit. Therefore, Option 3 is also contextually correct.
Under the self-balancing ledger system, each ledger is prepared under the double-entry system. For each transaction, there shall be a debit entry and simultaneous credit entry. Therefore, Option 4 is also contextually correct.
Under self-balancing ledger system, three ledger accounts are prepared namely Debtors Ledger, Creditor's Ledger and Nominal Ledger. So, option 1 contains an INCORRECT statement.

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