- This topic has 3 replies, 3 voices, and was last updated 10 years ago by
.
-
Posts
-
Allister’s payables ledger control account has a balance at 1 October 20X8 of $34,500 credit.
During October, credit purchases were $78,400, cash purchases were $2,400 and payments made to suppliers, excluding cash purchases, and after deducting cash discounts of $1,200, were $68,900. Purchase returns were $4,700.why do my PLCA have to include ‘Discount received of 1,200’ on the debit? i understand that discount received is under debit side, but the question stated, “after deducting cash discounts of $1,200, were $68,900”, doesn’t this means that 68,900 have already deducted 1,200?
why do i need to include it again on the PLCA debit side?
thank you, english is not my first language, please advise.
A little example to hopefully explain the english:
Suppose we owe $100, and there is a discount of $10.
We will therefore only need to pay $90 and we would say that we “paid $90 after deducting the discount of $10”.
So we would debit with 90 and also debit with 10.hello John
In the above example it is asked what was the closing balance on the purchase ledger control account. Should it not be payable ledger control account ?
- You must be logged in to reply to this topic.