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This is the question from bpp study text, p479, question 24
An accountant has inserted all the relevant figures into the trade receivables account, but has not yet balanced off the account.
TRADE RECEIVABLES ACCOUNT
Debit ……………………………………………………Credit
Balance b/d 100 750 ……………………….Cash at bank 250 225
Sales 325 010Assuming there are no other entries to be made, other than to balance off the account, what is the closing balance on the trade receivables account?
A. 425 760 DR
B. 175 535 DR
C. 425 760 CR
D. 175 535 CR
The correct answer is B, but I thought the closing balance (Balance carried down) would be 175 535 CREDIT, and the opening balance (balance b/d) at the start of next period would be 175 535 DEBIT. Where have i gone wrong?Remember this is double entry, the balancing figure is $175,535 CR which results in a balance b/d on the opposite side ie a DR entry.
Hope this helps
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