Which three statements are true about using Parent Accounts in NetSuite? (Choose Three)

In NetSuite's Chart of Accounts, a hierarchical structure is created by defining parent-child relationships. This is done by editing the child account and selecting an existing account in the "Subaccount of" field. A parent account can be configured as either a posting or a non-posting account. By checking the "Summary" box on the parent account's record, it is designated as a non-posting account. This prevents any direct transactions from being posted to it, and its balance will simply be a summary of its child accounts' balances, which is useful for reporting. If the "Summary" box is left unchecked, the parent account remains a posting account.

A: Checking the "Summary" box makes an account non-posting; therefore, no transactions, including reversing journal entries, can be posted to it.

D: The parent-child relationship is established from the child account's record using the "Subaccount of" field, not a "Parent of" field on the parent account.

1. NetSuite Help Center

SuiteAnswers ID: 9910

"Creating Accounts for the Chart of Accounts." This document states

"In the Subaccount Of field

select the parent account for this account... Check the Summary box to have this account serve as a non-posting summary account for reporting purposes." This confirms that the "Subaccount of" field creates the child relationship (Option B) and that the "Summary" box makes an account non-posting (Option C).

2. NetSuite Help Center

SuiteAnswers ID: 10023

"Setting Up the Chart of Accounts." In the section "Account Types

" it clarifies

"A parent account can be a posting account if it does not have the Summary box checked. If the Summary box is checked

the parent account is a non-posting account

and its balance is the rollup of its subaccounts." This directly supports the correctness of Option E.

3. University of Waterloo

School of Accounting and Finance

"AFM 321: Accounting Information Systems Courseware

" Module: The General Ledger and Chart of Accounts. The course materials explain

"To create a hierarchy

you define a subaccount relationship. On the new account record

you select an existing account in the 'Subaccount of' list... A parent account with the 'Summary' option enabled becomes a non-posting account

useful for high-level reporting without direct transaction entries." This corroborates the mechanisms described in options B and C.