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The accountant at Borris Co has prepared the following reconciliation between the balance on the trade payables ledger control account in the general ledger and the list of balances from the suppliers ledger:
Balance on general ledger control account……………………………… 68,566
Credit balance omitted from list of balances from payables ledger (127)
…………………………………………………………………………………………..68,439
Undercasting of purchases day book………………………………………. 99
Total of list of balances………………………………………………………… 68,538
What balance should be reported on Borris Co’s statement of financial position for trade payables?
A $68,439
B $68,538
C $68,566
D $68,665
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I can’t get the clue of solving this by seeing at the answer given at the back of the book. Please help me out with this oneHave you watched our free lectures (particularly those on Books of Prime Entry, and on Control Accounts)??
The balance on the control account should be 68566 + 99 (because of the undercasting of the purchase day book) = 68665.
The total of the balances in the ledger should be 68538 + 127 (because a balance had been omitted) = 68665
This is the figure that should appear in the SOFP.
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