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April 9, 2017 at 7:38 am
Dear John, I dont understand that when you debit receivables and credit cash when we have to refund to the customer. As you explained, I got it and I think it’s right in the scenario that the customer overpay us. However, in the case the customer return the goods and get money back. I think we need to debit sales and credit cash, so it’s not debit receivables all the time when we refund to customers, am I right?
John Moffat says
April 9, 2017 at 8:00 am
If a customer returns goods, then you debit sales and credit receivables.
It then means they have overpaid and have a credit balance on receivables. Then either this will reduce what they owe us for future purchases, or we will give them a refund. If we give them a refund then debit receivables and credit cash.
July 28, 2018 at 10:11 pm
Sir what is the credit balance in recievable control a/c
July 29, 2018 at 10:52 am
Amounts owing back to customers.
January 12, 2017 at 4:02 pm
Where is F3 Questions answer Bank
January 12, 2017 at 4:54 pm
Have you looked at the contents page of the lecture notes?!!!
August 29, 2016 at 1:11 pm
At 24:24 of the video you mention “turn to question 1” where can i find this question?
August 29, 2016 at 1:19 pm
You can’t and I must delete that from the lecture. There used to be a few test questions at the end of each chapter in the lecture notes. However they have been removed and instead we have online practice tests that you can find linked from the main Paper F3 page. (They contain the full workings with the answers and so don’t need lectures on them)
November 1, 2016 at 11:17 am
Hi, Quick question. What is the entry when payment is made for expenses after the Cash have been received from the customer?
November 1, 2016 at 2:10 pm
If expenses are paid out of cash then we credit cash and debit the expense account.
July 3, 2016 at 8:37 am
could you please explain why is cash refund to credit customers a debit in receivables control account? If it is a refund, shouldn’t we be crediting it from the credit sales?
July 3, 2016 at 9:44 am
A refund is a repayment of cash (maybe, for example, the customer paid us too much by mistake, and therefore we repay them).
When they pay us we debit cash and credit receivables. If we give them some of the cash back then we credit cash and debit receivables. It does not affect sales at all.
March 10, 2016 at 3:31 pm
Hi Sir In the receivable account, dishonoured cheques from credit customer is a debit entry? Thank you!
March 10, 2016 at 5:04 pm
Yes – that is correct 🙂
February 22, 2016 at 5:05 am
Thank you for lectures. While preparing and fixing errors for receivable/payable control account, am i right if i assume that only double entry ledger accounts affect control account and not the journal books like payable journal or receivable journal?
February 13, 2016 at 11:10 am
hello sir, In the test question 1, pg 110 why have you not considered allowance for receivables ? allowance reduced the amount to cash we’re going to receive. So why is that an error?
February 13, 2016 at 1:59 pm
An allowance does not reduce the cash we will receive. The cash is only reduced if a debt becomes irrecoverable (and I say this during the lecture).
I do suggest that you watch the free lectures on irrecoverable and doubtful debts.
January 24, 2016 at 10:02 am
I couldn’t able to find these question in the notes where are the examples?
January 24, 2016 at 12:09 pm
Try looking at example 1 in the chapter on control accounts.
June 8, 2015 at 7:24 pm
Sir! Chapter 16 Test papers QNo:4 reads as follows Opening balance of the payable ledger is $438900. There was a contra entry $980. The total of Purchase return journal was undercast by $1000 and an invoice of $4344 was posted as $4434. What is the amount to be reported as accounts payable.
The answer is said to be $437830 (D). but i disagree with it since there are purchase returns that has not been accounted for. I feel the answer is A ($4368300 That is Credit $438900 and debit $ 980 contra, Debit purchase return $1000 and debit the amount to correct the invoice $90 and the difference $436830. Kindly help.
June 8, 2015 at 8:36 pm
The answer in the lecture notes is correct.
The payables ledger is where each individual balance is recorded. Each item from the purchase returns journal will be entered separately in the individual accounts in the payables ledger.
The total is entered in the nominal/general ledger and so that is wrong and the payables ledger control account balance will be wrong. However the total does not affect the payables ledger itself at all.
August 21, 2015 at 2:51 pm
So the undercasting of purchase returns is to be corrected only in payables ledger control account?
August 21, 2015 at 3:36 pm
That is correct 🙂
August 21, 2015 at 3:57 pm
Thank you sir 🙂
June 8, 2018 at 4:19 am
which one is the right answer?? 436830 437830
June 8, 2018 at 8:44 am
The answer given in the text is correct, so I do not know why you ask!
March 24, 2015 at 7:16 am
Because it is always to cancel a receivable (so credit receivables) against a payable (so debit payables) because we are owed money and we owe money to the same person.
March 24, 2015 at 10:17 pm
Oh! I got that. Thank you so much!
March 23, 2015 at 8:23 pm
Can you please explain how is it that we always credit receivables and debit payables account in case of contra entries?
April 16, 2015 at 8:10 pm
He explained it in the first video @purnima. It’s more towards the end of the video if you want to fast forward.
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