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WAEC Financial Accounting 1996 Question 30

Question 30

Control Accounts

Discount received is shown in the

  1. A.credit side of sales ledger balances
  2. B.debit side of bought ledger balances
  3. C.credit side of bought ledger balances
  4. D.debit side of sales ledger balances
  5. E.sales ledger balances as contra entry
Show the answer and explanation

Answer: B (debit side of bought ledger balances)

Explanation

Discount received reduces what we owe suppliers, so it is debited in the bought (purchases) ledger.