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Control Accounts Example 2

The document provides financial data for Delta's sales ledger for May 2013, detailing sales, returns, and discrepancies in the accounts. It outlines the requirement to prepare a sales ledger control account and correct errors identified in the ledger. Additionally, it requests the preparation of a corrected control account and a reconciliation statement for the personal sales ledger balances.

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Eesa Kazembe
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5 views2 pages

Control Accounts Example 2

The document provides financial data for Delta's sales ledger for May 2013, detailing sales, returns, and discrepancies in the accounts. It outlines the requirement to prepare a sales ledger control account and correct errors identified in the ledger. Additionally, it requests the preparation of a corrected control account and a reconciliation statement for the personal sales ledger balances.

Uploaded by

Eesa Kazembe
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

Control Accounts – Example 2

The books of Delta gave the following information for the month ended 31 May 2013.
All sales and purchases were on credit.

Sales ledger balance at 1 May 2013 ................. $5 000


Sales for the year ............................................. $100 000
Sales returns .................................................... $2 000
Cheques from customers ................................. $93 000
Customers’ cheques dishonoured .................. $1 000
Discount allowed ............................................... $3 000
Irrecoverable debts written off ....................... $2 000
Debit balances transferred to Purchases Ledger Control Account .... $811

The total of all the personal accounts in the Sales ledger amounts to $9 400
which differs from the closing balance in the Sales ledger control account.

Required

(a) Prepare a Sales ledger control account for the month ended 31 May 2013.

The following errors have been discovered since the Sales Ledger control account
was prepared.

(i) A sales invoice for $2 500 had been completely omitted from the books.

(ii) A page of the sales day book with entries totalling $8 000 had been omitted
from total sales but the individual entries had been posted to the personal accounts.

(iii) A personal account balance of $4 000 had been omitted from the list of balances.

(iv) A customer’s account had been understated by $400.

(v) Discount allowed had been overstated by $511.

(vi) An entry of $1 500 in the sales day book had been omitted from the Sales ledger
account.

(vii) A contra entry had been made in the purchases ledger for a debit balance
of $1 200 in the sales ledger, but no entry had been made in the control account.
(viii) A receipt of $1 200 was debited to bank but not posted to customer’s account.

(ix) A credit note for $350 sent to a customer had been entered in the sales day book
and posted as a sale to both accounts.

(x) A customer owing $1 600 was declared bankrupt during May 2013.
The debt was written off in the control account but no entry had been made in customer’s
account.

(b)
(i) Prepare a corrected Sales ledger control account, extracting the relevant
information from the list of errors given above.

(ii) Prepare a statement showing the adjustments that are necessary to the list
of personal Sales ledger balances so that it reconciles with the amended Sales ledger control
account balance.

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