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Hello sir,
I am struggling with question 5.2 from the BPP revision guide. The solution shows that the closing debit balance of $2720 is entered into the credit side of the sales tax control account but I don’t understand why that is as I had entered it under the debit side. Could you please explain this to me? Many thanks
If the closing balance is a debit, then it means that is the balance remaining and it will have been carried down from the credit side when closing off the account because the total of the debit entries will have been bigger than the total of the credit entries.
I do explain the way we close of accounts in my free lectures working through the examples in Chapter 3 of our free lecture notes.
I appreciate the quick reply sir and on behalf of everyone that has used your lectures and resources , thank you.
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