This aspect of accounts is included in the book-keeping to correct possible errors, which may occur in the process of entries. It is usually referred to as “Total Account” or “Adjustment accounts”. The name total applies because the sums of entries are made in the individual accounts of thing, values, objects and persons.
A total account is an account that is debited and in the other way round credited to the total account of all the transactions which have been debited and credited in detail to the individual ledger accounts. A total account in respect of a particular ledger therefore operates as a control account for the ledger, since the balance of the total account at any particular time period should be equal to the sum of the balances of all the individual accounts within that ledger account. It also provides a check on the accuracy of such balances.
In control account, classification of accounts were made for the convenience that they offer in locating accounts in relation to identical entries.
Examples of the classification of accounts are thus:
(a) Sales or debtors ledger control accounts.
(b) Purchases or creditors control accounts.
(c) General ledger.
These three control ledger accounts classified here above are under two separate accounts. They are thus:
(i) Personal Account – This account relates to persons, that is debtors (Dr.) and creditors (Cr).
(ii) Impersonal Account – This relates to things, values and objects.