Which of the following statements is INCORRECT for self-balancing ledgers?
1
Self-balancing ledger system implies a system of ledger keeping which classifies ledgers as per nature of transactions.
2
Under the sectional balancing system, if the error affects the total of debtors' and creditors' accounts, it is rectified by adjusting the accounts of debtors and creditors themselves without any additional entries.
3
In a self-balancing system, a general ledger adjustment account is prepared in each of the subsidiary ledgers.
4
In self-balancing system, generally, three ledgers are prepared namely, debtor ledger, credit ledger and main ledger.