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GCE Financial Accounting 1989 Question 16

Question 16

Control Accounts

Discount allowed would appear on the

  1. A.debit side of Sales Control Account and the credit side of Purchases Control Account
  2. B.debit side of Sales Ledger Control Account only
  3. C.debit side of Purchases Ledger Control Account
  4. D.credit side of the Sales Ledger Control Account
  5. E.credit -side of the Purchases Ledger Control Account.
Show the answer and explanation

Answer: D (credit side of the Sales Ledger Control Account)

Explanation

Discount allowed reduces what debtors owe, so it is credited in the sales ledger control account.