The payables ledger account of Tiny Ltd in the books of Vasty shows a balance of $3,000 at the end of March,2007. This was different from the balance in the statement provided by Ting Ltd. The following were the causes of this difference:
(i) Purchase not recorded by Vasty Ltd of $200
(ii) Discount of $250 was not recorded by Tiny Ltd
What is the balance according to Tiny Ltd after reconciling the above errors?
Can you explain to me ?
The balance according to Tiny Ltd after reconciling is $3,200, this is because the original purchase was $ 3,250, in the books of Tiny Ltd and then a discount was given for $250, this will reduce the purchasing invoice by $250, sums up to $3,200.
In the books of Vasty from $ 3,000 to add $ 200 to total up $ 3,200. Then the books will be balance.
The invoice should be $3,450 not $3,250.
The total invoice should be of $3450. Though this defect was easy to find, as credit amount and discount amount is not too much. Last year my company was to get merged with one similar company , but the problem was coming on the side of reconciliation of the account. Inspite of our best services, we were not able to find the wrong figure. We have taken the services of Investmentbank http://investmentbank.com/valuations/mergers/. They provided a very good service in this regard.
I’ve just started chapter 16, Control Accounts, and under control account reconciliation I can’t understand those errors that affect payables/receivables ledger accounts only and and those that affect payables/receivables ledgers control accounts only as well as those that affect both accounts.
May someone help.
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