Theory question 105
Control AccountsThe following balances have been extracted from the books of Johnson Ltd. (₦)
January 2014: Sales ledger balances 96,000
January 2014: Purchases ledger balance 160,000
Purchases journal 1,600,000
Sales journal 4,000,000
Cash and cheques from customers 2,320,000
Cheques paid to suppliers 1,200,000
Return outwards journal 24,000
Returns inwards Journal 40,000
Discount allowed 44,000
Discount received 1,680
Bad debts written off 1,200
Customers cheques dishourned 480
Balance of sales ledger set off against balance in the purchases ledger 8,000
Petty cash to suppliers 16,000
Bills receivable 1,280
Bills payable 2,520
Discount allowed now disallowed 240
Service charges added to unpaid accounts 832
Credit notes issued to customers 39,440
Balances at 31st December 2014: Purchases ledger 24,000Dr; Sales ledger 400,000Cr
You are required to prepare: (a) Total Debtors Account; (b) Total Creditors Account.
Show the model answer
(a) Total Debtors Account (₦): Dr - balance b/f 96,000; sales 4,000,000; cheques dishonoured 480; discount disallowed 240; service charges 832; balance c/d (credit balances) 400,000 = 4,497,552.
Cr - cash and cheques 2,320,000; returns inwards 40,000; discount allowed 44,000; bad debts 1,200; set-off 8,000; bills receivable 1,280; credit notes 39,440; balance c/d 2,043,632 = 4,497,552.
Debit balance b/d 2,043,632; credit balance b/d 400,000.
(b) Total Creditors Account (₦): Dr - petty cash 16,000; cheques 1,200,000; returns outwards 24,000; discount received 1,680; set-off 8,000; bills payable 2,520; balance c/d 531,800 = 1,784,000.
Cr - balance b/f 160,000; purchases 1,600,000; balance c/d (debit balances) 24,000 = 1,784,000.
Credit balance b/d 531,800; debit balance b/d 24,000.
The printed list puts each amount one line above its label; take the amounts in order.