The first step in creating subsidiary transactions is to identify General Ledger accounts that will serve as subsidiary control accounts. Each control account will have a two-character subsidiary code. Individual subsidiary accounts can be set up using subsidiary control accounts. A subsidiary account tracks the transactions and the balances of an individual, and an individual may have one subsidiary account for each control account.
To create a subsidiary account, a Subsidiary Master row must be created. The Subsidiary Master row is the portion of the subsidiary account that keeps track of the balances and must exist before we can create subsidiary transactions for an individual.