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Control Accounts in Accounting

Control accounts are used to manage and verify the balances of debtors and creditors by tracking additions and deductions to their figures. The document outlines the principles of calculating closing balances based on opening balances and transactions, including sales, payments, and returns. It also provides formats for Sales and Purchases Ledger Control Accounts to record these transactions.

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Audrey Roland
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19 views2 pages

Control Accounts in Accounting

Control accounts are used to manage and verify the balances of debtors and creditors by tracking additions and deductions to their figures. The document outlines the principles of calculating closing balances based on opening balances and transactions, including sales, payments, and returns. It also provides formats for Sales and Purchases Ledger Control Accounts to record these transactions.

Uploaded by

Audrey Roland
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 Add or Debit all items that increases debtors figure.

Opening
Debit Balance, Credit Sales, Interest on Debt, Overpayment
amounts or refunds, Dishonored cheques, closing credit
A Control account is used as a Trial balance for each ledger to
balance.
check for errors.
Deduct or credit all items that decreases debtors figure opening
credit Balance, cash or cheques Received, return Inwards, Bad
The Principle is that if we know the opening Balance for the a/c as
debts, Discount Allowed, Set off, closing debit balance.
well as the additions and deductions, the closing Balance can be
Purchases Ledger Control Accounts/Total Creditors Control
calculated.
Accounts
Sales Ledger Control Accounts/Total Debtors Control Accounts
Source of Information
Source of Information
Opening Creditors List of creditors from the previous
period
Opening Debtors List of Debtors from the previous
period
Credit Purchases Purchases Journal
Credit Sales Sales Journal
Return Outwards Return Outwards Journal
Return Inwards Return Inwards
Cash and Cheques Paid Cash Book
Journal
Discount Received Cash book
Cash and Cheques Received Cash Book
Closing Creditors List of Creditors at the end of the
Discount allowed Cash book
accounting period
Closing Debtors List of Debtors at the end of the
Add or Debit all items that decreases Creditors figure. opening
accounting period
debit Balance, cash or cheques Paid, return Outwards,
Discount Recieved, Set off, closing Credit balance.
Deduct or credit all items that increases Creditors figure
Opening credit Balance, Credit Purchases, over payment, Format Purchaseses Ledger Control Accounts
interest charged on debt, Cash refund from creditors, closing
credit balance.
Purchases Ledger Control A/cs
2005 $ 2005 $
Format Sales Ledger Control Accounts Jan 1 Bal b/d (debit) 000 Jan 1 Bal b/d(credit) 000
Cash or Cheques Paid Credit Purchases 000
Return Outwards 000 Cash Refund from 000
creditors
Sales Ledger Control A/cs Discount Received 000 /Overpayment 000
2005 $ 2005 $ returnedfrom
Jan 1 Bal b/d(debit) 000 Jan 1 Bal b/d (credit) 000 creditors
Credit Sales Cash or Cheques 000 Set Off:Sales Ledger 000 Bal c/d (debit) 000
Reveived Bal c/d (credit) 000 ___
Cash 000 Bad Debts 000 000 000
Refund/Overpayment Bal b/d 000 Bal b/d 000
Dishonoured Cheques 000 Discount Allowed 000
Interest on Debt 000 Return Inwards 000
Bal c/d (credit) 000 Set Off:Purchases 000 Note: The closing debit balance c/d may not be given but must
Ledger
be calculated.
Bal c/d (debit) 000
000 000
Set off is where there is mutual indebtedness as in I owe you
Bal b/d 000 Bal b/d 000 and you owe me.

Note: The closing credit balance c/d may not be given but must
be calculated.

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