Business need to maintains individual ledger.

Showing debt they still owe,itemising new invoices sent out and payment received.

To ensure no customer is exceeding their credit limit.

Require references from suppliers with whom they already have credit account and their bank.

Depend upon the information supplied.

If customer has invoices overdue for payment,it may decided no futher orders can be accepted.

Allowing businesses to keep trading without having to provide cash 'up front'.

Allow credit terms to customers and receive credit terms from its supplier.

A customer will be given a credit limit.

Aged receivables analysis

Interest costs of an overdraft,if customers do not pay promptly.

Costs of trying to obtain payment.

Court costs.

When invoices entered in the trade receivables general ledger account

When entries are made in the bank general ledger account in respect of payments received from customers,or if goods are returned

Because the personal accounts include details of transactions which have already been recorded in the general ledger.

sales invoices are recorded in sales and trade receivables general ledger accounts,and payments received from customers are recorded in the bank and trade receivables general ledger accounts.

if they did,transactions would be recorded twice over.