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Dear tutor,
I encountered this question whose answer I did not fully understandWhich of the following errors should be identified by performing a receivables control account reconciliation?
A A sales invoice of $500 has been omitted from the sales daybook.
B A sales return of $45 was entered as $54 in the sales returns daybook.
C Purchases of $72 were entered as sales returns in the sales returns daybook and the individual
account.
D The total of the sales daybook was miscast by $200.The correct answer is D
Could you please explain to me why D is the right answer and the others aren’t, and what is the relation between sales day book and receivables control account, I still have some troubles dealing with these kinds of questions.
Thank you!
Items in they book are posted to the individual accounts in the receivables ledger. It is the total of the day book that is posted to the control account.
If something is entered wrongly in the day book, then the total will be wrong as well, so both the receivables ledger and the control account will be wrong – but they will still agree.
In D, only the total was wrong, so only the control account will be wrong (but the individual account in the receivables ledger will the correct).
Please do watch my free lectures on Books of Prime Entry, where all of this is explained.
The lectures are a complete free course for Paper FA and cover everything needed to be able to pass the exam well.
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