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Dear Mr Moffat
I have this exercises that is difficult to me. Please, help me. I even don’t know how to approach those exercises. I don’t know what skills are they testing here. Please, help me to understand what is going on here.
Balance on the sales ledger control account is 41590
Total of the balances in sales ledger is 40950
The difference is 640
Which two of the reasons below could explain the difference ?
1. Goods returned may have been entered in the customer’s account in the sales ledger twice.
2. Discounts allowed were entered in the sales ledger account only.
3. Goods returned have been omitted from the sales ledger control account.
4. Goods sold were entered twice in the customer’s account in the saled ledger.
5. A cheque received was entered in the sales ledger control account twice.Regards. Rafal
It is testing your understanding of the books of prime entry.
If you watch my free lectures on Books of Prime Entry you will see that the sales ledger control account is the total receivables account where all the entries are in total. The sales ledger is not part of the double entry but it is book keeping a note of how must each individual customer owes.
The total of the balances in the sales ledger should be equal to the balance on the control account – if they are not equal then there is a mistake in one of the two.
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