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Hi
Could someone help me with the solution to this question
Annie is a sole trader who does not keep full accounting records. The following details relate to her transactions with credit customers and suppliers for the year ended 30 June 20X6:
$
Trade receivables, 1 July 20X5
130,000
Trade payables, 1 July 20X5
60,000
Cash received from customers
686,400
Cash paid to suppliers
302,800
Discounts allowed
1,400
Discounts received
2,960
Contra between payables and receivables ledger
2,000
Trade receivables, 30 June 20X6
181,000
Trade payables, 30 June 20X6
84,000What figure should appear in Annie’s income statement for the year ended 30 June 20X6 for purchases?
Since the question is about purchases, dont worry about the receivables part of the question.
create a T account for trade payables
on the debit side u have
302800 Cash paid to suppliers
2,960 Discounts received
2000 Contra between payables and receivables ledger
84000 Trade payables Closing balanceand on the credit side u have the opening balance of TP which is 60000
Add all the figures on the debit side and minus it from the 60000 on the credit side and u have the figure for purchases 331760
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