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June 29, 2021 at 12:29 pm
The question 3 is playing me. The part of returns journal undercast by 1000. I thought it will make my payables less. So please help me over here
John Moffat says
June 29, 2021 at 4:47 pm
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.
December 20, 2020 at 9:17 am
I couldn’t understand the 1st question. Does sales account mean trade payable account ?
December 20, 2020 at 10:30 am
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.
December 20, 2020 at 12:09 pm
Already did that, could you please explain option D and A.
December 20, 2020 at 4:05 pm
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.
November 29, 2020 at 7:39 pm
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.
November 30, 2020 at 9:32 am
An invoice from a supplier is credited to the suppliers account, because money is owed.
They have credited with too much and therefore we need to debit the account to correct it.
December 1, 2020 at 7:06 pm
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
November 13, 2020 at 4:14 pm
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.
November 13, 2020 at 5:17 pm
The figure in the SOFP should be the correct balance on the control account. The correct balance will be the same as the correct total of the balances on the account in the payables ledger.
October 17, 2020 at 9:06 pm
100 percent , Not a bit of confusion. Thoough i will try exam kit.
August 5, 2020 at 4:38 am
Hi Sir, for Q2 the trade receivable 30 June 2008 $181,000, I wonder why this isn’t 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?
August 5, 2020 at 4:40 am
We do use the trade receivable of 2007, but how come we ignore the trade receivable 2008? I just can’t get it.
August 5, 2020 at 8:11 am
The question asks what the payables are at the end of the year. The receivables have nothing to do with it.
May 16, 2020 at 10:17 am
Discount disallowed got me ??
May 16, 2020 at 11:30 am
Hope you are OK with it now 🙂
January 31, 2020 at 4:16 am
Thanks Mr John. This test makes too much sense to me. Please I will love to have more past ACCA exam questions and Answers for continuous practice
January 31, 2020 at 8:27 am
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.
July 24, 2019 at 4:31 pm
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…….
July 25, 2019 at 9:53 am
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.
May 26, 2019 at 1:30 pm
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?
May 27, 2019 at 12:42 pm
No – too high an amount was posted to the account, and therefore the total of the list of balances is too high.
November 29, 2020 at 8:10 pm
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 !
March 23, 2019 at 3:36 pm
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?
March 23, 2019 at 4:15 pm
We are given the correct total of the payables ledger and need to correct that total.
The total in the returns journal is entered in the control account, not in the payables ledger. In the payables ledger we enter each individual item from the journal, to the individual accounts. We don’t enter the total in the payables ledger.
March 25, 2019 at 7:40 pm
ohh.. It’s clear now.. Thank you..
June 13, 2020 at 2:06 pm
Thank, it`s clear for me now too:)
June 13, 2020 at 4:59 pm
January 22, 2019 at 2:59 pm
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
January 22, 2019 at 5:07 pm
Discounts received reduce payables and therefore we debit payables.
Contras always reduce payables and reduce receivables. therefore we debit payables and credit receivables.
November 1, 2018 at 3:20 pm
Why 8950-4080? (q#4)
November 1, 2018 at 3:36 pm
Because the statement sent by Paul shows that Paul thinks he is owed 8,950.
Paul has not entered cash of 4,080 that has been paid to him. When he does enter it then he will show that he is owed less.
September 15, 2018 at 12:49 am
question number 3 did not understand,could you please explain
thank you in advance
September 15, 2018 at 10:26 am
You will have to say which bit of the answer you do not understand – there is no point in me simply repeating the answer that is shown after you submit your answer.
Did you watch my free lectures on Control Accounts and on Books of Prime Entry before attempting the test?
September 16, 2018 at 10:59 pm
thank you for your reply ,i watched your lectures ,you are such a great teacher,i do not miss any of your lecture
i rechecked the question ,i understood except why did we subtracted Contra amount from payable ledger ???
September 17, 2018 at 6:05 am
A contra is to cancel out a payable against a receivable. So it reduces the individual payable, which means the total of the individual balances reduces. It also reduces total payable, which reduces the balance on the payables ledger control account.
September 18, 2018 at 6:31 pm
yeah ,thank you, i understood
September 19, 2018 at 6:45 am
You are welcome 🙂
July 14, 2017 at 12:35 am
In question3, I think the question is to ask the accounts payable.
Why does the answer say the correct balance in the ledger?
July 14, 2017 at 8:05 am
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.
June 12, 2016 at 9:30 am
why $4140+40=4180 ?
so different $4870-$4100=$770
June 12, 2016 at 12:55 pm
Peter must have recorded himself as having received a discount from Paul (otherwise no adjustment would be needed).
Therefore he will have shown himself as owing 40 less.
Paul has not allowed the discount and therefore Peter owes 40 more.
November 18, 2016 at 11:49 am
in question no 4 -(8950-4080 must be equal to 4140+40) otherwise question is wrong
November 18, 2016 at 3:17 pm
Sorry but that is absolute nonsense!!
The question says “What discrepancy remains…..”
Since discrepancy means difference, then obviously they are not going to be equal!!!
September 16, 2017 at 9:33 pm
For myself, I read “Allowed” but it actually reads “Disallowed”. I was used to reading “discounts allowed” from the previous questions. Reminder to read carefully.
September 17, 2017 at 7:18 am
Good point 🙂
May 20, 2019 at 10:14 am
Me too. I also realised that after double checking my answers. Anyway I would like to thank Mr. John for your amazing works. Open tuition has changed my life.
May 20, 2019 at 10:55 am
Thank you for your comment 🙂
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