***help***a question about control account( INT F3)

Jjane10621515y ago

a firm which sells exclusively on credit allows a discount of 2% to its customers they pay by the due date, which they always do.
information given:
amount owed by debtors at the beginning of the year: $22,000
amount owed by debtors at the end of the year $24,000
bad debt written off during the year $ 3,500
money received from debtors during the year $147,000.

the firm's credit sales for the year were:?

my solution is :
24,000+3,500+147,000-22,000?152,500
152,500*2%:),050
152500+3050?155?550

am i right? its not same as the given answer, but i don't know where is wrong.
somebody can explain for me?
thank you!

Former user15y ago#1

Hi Jane,

You're very close, but missing one piece of the puzzle--use a little more algebra.

Let x = credit sales
Lex 0.02x = discounts allowed ( the 2% the customers always take)

Now, make a T account: On the debit side, you need to insert (dropping zeros):

Opening balance: 22
Sales: x

On the credit side, you need to enter usual credit items, using 0.02x for D.A.:

Cash 147
Bad debts written off 3.5
Discounts allowed 0.02x
Closing balance 24

Finally, use algebra to solve for x--the debits must equal the credits (as you know):

22 + x = 147 + 3.5 + 0.02x + 24

simplifies to:

0.98x = 147 + 3.5 +24 - 22

etc...

Jjane10621515y ago#2

thank you very much.

Jjane10621515y ago#3

thank you very much.

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