Hi,
Clearing accounts acts like a bridge between two accounts and helps us to trace the actual posted and the balance left
due to various reasons. They are required in only particular type of transactions and not for all. To cite an example,
we have GR/IR Clearing account. This is an intermediary account between Inventory and Vendor. We can monitor
the balance in the account for actual goods received with reference to the purchase order and the value of goods
cleared for billing to Vendor. These are also termed as reconciliatiion accounts. Some other accounts are Account
receivable, Accounts Payable, and Tax Payable accounts.
Regards,
Sadashivan
Bluesky
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