RECEIVABLE AND PAYABLE LEDGER

Q No: 20

Whilst carrying out a reconciliation of the payables’ ledger control account with the payables’ ledger, Betty found that a purchase of goods for $575 had been recorded in the purchase day book as $557.

How should this error be corrected in the payables’ ledger control account and the list of balances per the

payable ledger control account list of balance

A) Debit 18 ADD 18
B) Credit 18 ADD 18
C) Debit 18 SUBTRACT 18
D) Credit 18 NO CORRECTION REQUIRED

the correct ans shown in text is (A)

DOUBTS – shouldnt the correct ans be (B) since if the entry in the purchase day book is understated by 18 then wouldnt it also understate the total and hence understating the balance on the payable ledger control account and so to correct this entry we should increase the payable ledger control account balance by 18 shouldn’t we?