AS LEVEL ACCOUNTING CONTROL ACCOUNT
1 JR's sales ledger control account balances at 1 March 2008 were as follows.
Dr $340 600 Cr $1 960
During March 2008 the following transactions took place.
Y
Credit sales 295 000
Cash sales 219 750
Sales returns from credit customers 6 480
N
Receipts from debtors 238 600
Discounts allowed 3 500
O
Additional information for the month of March 2008
1 The receipts from debtors included a cheque for $3600 in full settlement of a debt
of $3800. This was returned by the bank on 28 March marked "insufficient funds".
R
2 Eva Little and JR both buy from and sell to each other. At 31 March 2008 Eva
owed JR $5000 and JR owed $8600 to Eva. They agreed to offset balances, the
net amount being payable by JR on 31 March 2008.
4
off.
ED
It was agreed that a debt of $2300 from Alice Springs was bad and it was written
The total credit balances in the sales ledger control account at 31 March 2008
were $8340.
M
REQUIRED
(a) Prepare JR's sales ledger control account for the month of March 2008.
AH
(b) State three possible reasons why a receivables account might have a credit balance.
(c) State three reasons for keeping control accounts.
D
JI
SA
SAJID AHMED RONY 1
COMMERCE DEPT
MOB: +8801716738397, +8801816573443
AS LEVEL ACCOUNTING CONTROL ACCOUNT
2 The sales ledger control account of Dream Beds for the year ended 31 December
2010 is shown below.
$ $
Jan 1 Balance b/d 43 900 Dec 31 Sales returns 28 510
Dec 31 Sales 522 650 Bank 436 300
Bank (dishonoured cheques) 2 200 Discount allowed 28 800
Y
Bad Debts 8 400
PLCA 3 210
N
Balance c/d 63 530
568 750 568 750
O
The schedule of trade receivables (debtors) extracted from the sales ledger at
31 December 2010 totalled $61 140.
R
The following errors were subsequently discovered:
1 A sale of $750 had been entered in John’s account in the sales ledger as
$570. The correct entry had been made in the sales journal.
2 ED
An entry of $850 was correctly entered in Samera’s account in the sales ledger,
closing the account owing to Samera’s bankruptcy. No other entry had been
made.
3 A sum of $120 discount allowed had been debited to Beach’s account in the
M
sales ledger. The correct entry had been made in the cash book.
4 At 31 December 2010 the balances in Richard’s accounts were:
AH
$
Purchases Ledger 2680 Credit
Sales Ledger 1980 Debit
It was decided to set off Richard’s balance in the sales ledger against the
balance in the purchases ledger. No entries had been made.
D
5 Goods to the value of $800 were sold to Claire in June 2010, and the account
had not yet been paid. Interest charges of $30 are to be applied on the overdue
JI
account, but no entries for this had yet been recorded.
In addition a provision for doubtful debts of 10% on the new outstanding
balance is to be created.
SA
6 Dream Beds had sent goods with a selling price of $400 on a sale or return
basis to Majit. Majit had not yet signified any intention to purchase the goods.
Dream Beds had considered the goods as sold, and made the relevant
accounting entries.
7 A page in the sales returns journal in October 2010 had been undercast by
$1600. No correction had yet been made.
SAJID AHMED RONY 2
COMMERCE DEPT
MOB: +8801716738397, +8801816573443
AS LEVEL ACCOUNTING CONTROL ACCOUNT
REQUIRED
(a) Prepare the corrected sales ledger control account for the year ended 31 December 2010.
(b) Prepare a statement reconciling the schedule of trade receivables total with the cor-
rected balance in the sales ledger control account.
(c) Explain two advantages of using a sales ledger control account.
Y
3. Beximco Ltd prepared a Control Account for the month ending 31 May 2011 from the following
N
information:
£
O
Debit balance at 30 April 2011 29 010
Payment by customers 216 045
R
Sales 282 324
Discount allowed 7 200
Bad debts written off 3 720
Returns inwards
Credit balances at 31 May 2011 ED 10 080
444
The balances on the control account and the balance in the sales ledger did not agree. The following
errors and omissions were discovered:
M
• discount allowed of £120 had not been entered in the cash book;
• Sales invoice dated 30 May 2011 had not been posted to the sales journal, £8 110;
• bad debts written off included an adjustment increasing the allowance for receivable by £750;
AH
• cash sales receipts, £585, had been omitted from the sales account;
• a credit balance, £69, had been incorrectly listed as £96.
Prepare an amended Receivable Ledger Control Account for the month ending 31 May 2011.
D
JI
SA
SAJID AHMED RONY 3
COMMERCE DEPT
MOB: +8801716738397, +8801816573443
AS LEVEL ACCOUNTING CONTROL ACCOUNT
4. Aftab ltd employed an inefficient book-keeper. On his last working day he prepared the following
Sales Ledger Control Account for the month ended 30 June 2011.
Sales Ledger Control Account
£ £
Balances b/d 18 309 Returns Inwards 2 010
Y
Cash Sales 30 200 Bank 18 971
Credit Sales 20 814 Provision for Bad Debts 500
N
Set-off (Contra) 509 Balances c/d 49 594
Discounts Allowed 943
O
Bad Debts 300
71 075 71 075
R
The book-keeper had also balanced the Receivable Personal Account.
In addition to the errors in the Sales Ledger Control Account, an examination of the Receivable
•
Accounts revealed the following:
ED
A bad debt of £28 had been debited to Bad Debts Account, but no entry had been made in the
Receivable Account.
Returns Inwards, £124, had not been posted to the Receivable Account.
• A Receivable Account had been over-added on the credit side by £30.
M
• The Purchase Ledger Set-off had been correctly entered in the Purchases Ledger, but not posted
to the Receivable Accounts in the Sales Ledger.
• A cheque received from a customer, £1 328, had been entered in her account as £1 382.
AH
Prepare a corrected Sales Ledger Control Account for the month ended 30 June 2011.
D
JI
SA
SAJID AHMED RONY 4
COMMERCE DEPT
MOB: +8801716738397, +8801816573443
AS LEVEL ACCOUNTING CONTROL ACCOUNT
5. Regency Ltd extracted the following information from its bookkeeping system for the six months
ended 30 November 2010, for the purpose of preparing a control account.
£
Total sales invoices as per sales day book 189 879
Y
Total interest charged to customers 595
Total discount allowed 2 900
N
Total cheques and cash received 201 789
O
Sales ledger balances:
Opening debit balances 67 090
R
Opening credit balances 1 700
Closing credit balances 980
(i) To write off £1 908 as bad debt;
ED
On 1 December, credit controller of the company reviewed the sales ledger accounts and made the
following decisions:
(ii) To write off sundry credit balances totalling £45;
(iii) To increase allowance for receivable from its existing balance of £2 000 to £2 890.
(iv) To correct a misposting to ABC Ltd account, where by an invoice of £325 had been entered as
M
£352.
You are required to prepare a sales ledger control account for the six month ended 30
AH
November 2010.
D
JI
SA
SAJID AHMED RONY 5
COMMERCE DEPT
MOB: +8801716738397, +8801816573443
AS LEVEL ACCOUNTING CONTROL ACCOUNT
6. The following entries had been included in the receivable ledger control account of Rex Ltd for the
year ended 31 May 2011.
£
Balance at 1 June 2010 19 340
Y
Sales (note i) 188 216
Receipts from customers (note ii) 144 030
N
Discount allowed (note iii) 4 800
Return inward 6 720
O
Bad debts written off (note iv) 2 480
Receivable ledger balances at 31 May 2011 were: Debit
Credit (note v) 296
R
Notes:
i) Sales invoices totalling £5 400 had been omitted from the sales day book totals.
ii) Sales receipt included £390 paid in by customers by cash sales.
ED
iii) £80 discount allowed had been omitted from the cash book total.
iv) The bad debt written off included a transfer to income statement of £500 which represents the
increase in a general allowance for receivable in the year.
v) A credit balance of £46 had been listed incorrectly as £64.
M
Required:
a) Prepare the receivable ledger control account for the year ended 31 May 2011.
b) Calculate the total of debit balances in the receivable ledger.
AH
D
JI
SA
SAJID AHMED RONY 6
COMMERCE DEPT
MOB: +8801716738397, +8801816573443
AS LEVEL ACCOUNTING CONTROL ACCOUNT
7. XYZ Limited prepares control accounts at the end of each month. For August 2011, the balances
and transactions were as follows:
£
Opening credit balances on payable ledger 7 600
Opening debit balances on payable ledger 100
Y
Opening debit balances on receivable ledger 17 100
Opening credit balances on receivable ledger 100
N
Transaction for the month:
O
Credit sales 42 100
Discount allowed 700
R
Sales returns 890
Discount received 960
Cheques from customers dishonoured 470
Payments to suppliers
Credit purchases
Cheques from credit customers
ED 23 750
33 650
29 420
Cash refund to customers 270
M
Bad debts written off 1 100
Amounts settled by contra 3 500
AH
Closing credit balances on receivable ledger 140
Closing debit balances on payable ledger 80
Prepare receivable and payable ledger control accounts for XYZ Limited for August 2011,
inserting closing balances for receivable and payable balances.
D
JI
SA
SAJID AHMED RONY 7
COMMERCE DEPT
MOB: +8801716738397, +8801816573443
AS LEVEL ACCOUNTING CONTROL ACCOUNT
8. Jamuna Limited has recently appointed a new accountant who has prepared a receivable ledger
control account for the month of 31 may 2011.
The control account shows the following details:
£ £
Y
Balance b/d 45 230 Balance b/d 260
Cash and cheques received 189 630 Sales invoices 175 320
N
Balance c/d 150 Credit notes issued to customers 450
Bad debts written off 2 300
O
Allowance for receivable 3 000
Contra payable ledger 180
R
Balance c/d (balancing figure) 53 500
235 010 235 010
ED
After preparing the receivable ledger control account, three errors had been identified as follows:
a) A credit balance £120 at 31 May 2011 had been added to the list of the closing receivable instead
of being treated correctly.
b) The debit balance of Saif £340 had been listed as Kaif.
c) The debit balance of Sourav £490 had been omitted from the list.
M
Prepare a corrected receivable ledger control accounts for Jamuna Limited for May 2011,
inserting closing balances for receivable ledger.
AH
D
JI
SA
SAJID AHMED RONY 8
COMMERCE DEPT
MOB: +8801716738397, +8801816573443