Free ACCA & CIMA online courses from OpenTuition

Free Notes, Lectures, Tests and Forums for ACCA and CIMA exams

20% off ACCA & CIMA Books

OpenTuition recommends the new interactive BPP books for December 2024 exams.
Get your discount code >>

FA Chapter 16 Questions Control Accounts

聽

Reader Interactions

Comments

    • The total of the returns journal is entered in the payables control account and does make the total payables less in the account.

      However the question gave the total in the payables ledger, which is where each individual payable is recorded. Each individual return will be entered there and whether or not the total is added up correctly does not affect the payables ledger.

    • The sales account is nothing to do with trade payables. It is the account in which sales are recorded. Have you not watched the earlier lectures? This account is explained in the lectures on Chapter 3 of the lecture notes.

      • There is no D or A.

        For cash sales we debit cash and credit sales (not debit sales).
        For credit sales we debit receivables and credit sales (not debit sales).
        For goods returned it could be a debit in the sales account (if a customer had returned goods to us).
        Irrecoverable debts are credited to receivables and so not affect sales at all.

  6. Hello Mr. John,
    Really grateful for the learning opportunity. My enquiry is on transaction no.3 of question 3 .
    Please Sir, why do we have to deduct/debit the incremental amount of $90 (i.e. 4,434 – 4,344) AGAIN from the payables account instead of crediting/adding it in order to offset the already inflated debit entry for which invoice, Adele wrongly recorded – an error I believe to be of original entry? Or what does “invoice” therein, refer to? Does it not mean cash was paid to supplier for which Adele received an invoice to that effect, hence the value debited? Or does “invoice” in transaction no.3 mean something else? Thank you.

      • Thanks so much Sir John… But just to be absolutely clear on treating invoices : does it mean that invoices recorded in the supplier’s account, always are by default, a credit entry in the supplier’s account just as we would have treated cash received to be a debit entry in our cash/bank account or contra to be credit and debit entries on receivables and payables ledger respectively ? Please confirm or advise otherwise. Thank you

  7. I got a wrong in Q3, because I assumed we had to fix the payable control account, as the question stated what would be entered into the SOFP, and you earlier had stated that Control account is concerned with SOFP, and Ledger accounts with individual customers. So I messed up. Please do advise.

    Also, the total of a journal (overcast/undercast) does not affect Receivable/Payable Ledgers. But is the opposite true as well ? If an individual entry is entry is entered wrong on the Receivable/Payable Ledgers, it wont affect the entry into the Control Accounts in the General ledger, correct ? (As the first are notes, and the latter are dual entry). Please do confirm or advise.

  9. Hi Sir, for Q2 the trade receivable 30 June 2008 $181,000, I wonder why this isn鈥檛 the figure being entered into statement of financial position? And why it is not being used I mean we do use the trade receivable for the calculation of payable ledger control a/c, but how come we simply ignore it?

    • As I say in the introductory lecture, it is essential that you buy a Revision Kit from one of the ACCA approved publishers (BPP and Kaplan). They are full of exam standard questions for practice.
      Our tests are just meant as short, quick progress tests.

  12. sir could you tell me in question no 4?why we have added discount recieved by peter and allowed by paul in peter’s balance?actually i have concept that if supplier is providing us discount we should deduct it from paybles…….

    • It is true then when we get a discount from a supplier we reduce payables.

      However the question says that the discount has been disallowed (i.e. not allowed) and so we need to cancel it which means adding to payables.

  13. sir in question 3 the statement says that the invoice for the $4344 as been posted wrong in the supplier’s account ..so the difference comes as $90. so sir why are we subtracting it? shouldn’t we add it as we wrote less amount in the total list of balances?

      • Hello Sir John,
        Please by your response I believe you are equally referring to :

        too high an amount (OF 4,434) was posted ( AS A DEBIT ENTRY), to the account(i.e. THE PAYABLES ACCOUNT)….right??
        Question: if my interpretation of your above response is correct, then shouldn’t the correction of this error of a higher debited amount be that the increment be removed by crediting the account instead?
        Please update, confirm or advise. Thank you !

  14. Hi John,

    First I’m very thankful for your efforts and commitment to society as whole. Regarding to Q3 error No:2, I couldn’t understand why we have not subtracted the balance with 1,000 also? Could you expand it little bit?

    Thank you..

  15. sir in quesstion 2 the discount received and contra should be added to 302,800+331,760…and then we will subtract 60,000
    discount received always comes on the debit side on payable ledger..and also contra.. I am confused sirr

    • Because the correct balance in the ledger will be the same as the balance in the total payables account, and therefore the figure to appear in the SOFP.

      We do not know the balance in the total payables account – only the current total of balances in the ledger, and so if we correct that total we will have the figure we need.

Leave a Reply