Tutorial 5 control accounts
QUESTION 1
The following Sales Ledger Control Account was prepared by an inexperienced
accounts assistant of Batswana Ltd Co. for the month of March 2016:
Sales Ledger Control Account
P P
Balance b/d 43,000 Cash received 206,000
redit sales 640,000 Bad debts written off 9,000
Discounts allowed 5,000 Sales returns 1,600
Interest charged 6,000
Allowances to customers 5,920 Balance c/d 471,320
693,920 693,920
SALES LEDGER CONTROL ACCOUNT
DATE DETAILS AMOUNT(P) DATE DETAILS AMOUNT (P)
31 BAL B/D 471320 Discount 10 000
allowed(5000*2
Interest 12 000 Allowances to 11 840
charged customers
( 6000*2) ( 5920*2)
Over cast of 400 Contra entry 1 600
discount
allowed
Omitted 11 000 bank 4 000
invoice
Overcast of 3 500
salesday book
Bal c/d 463 780
494 720 494 720
1 April bal b/d 463 780
RECON STATEMENT FOR RECIEVABLES
CONTROL ACCOUNT AS AT 31 MARCH
P P
LIST OF SALES LEDGERS BALANCES 455 082
Add: omitted invoice 1 200
Correction of error (500*2) 1 000
Undercast of customers account 100
Omission of debit balance 1 318
Omission of invoice 11 000
14 618
469 700
Less: allowances to customers 300
Omission of credit transfer 4 000
Error of in posting a cheque 1 620
5920
Balance as per sales ledger control account 463 780
The list of balances extracted from the Sales Ledger at 31 March 2016 totalled P455,
082.
In addition to the errors in the above Sales Ledger Control Account, the following
errors and omissions were discovered:
i. An invoice for P1, 200 was entered in the Sales Daybook but had not been
posted to the customer’s account in the Sales Ledger.
ii. The discount allowed column in the business’s cash book was over-added
by P400.
iii. The allowances to customer’s figure of P5, 920, appearing in the above
Control Account, includes P300 which has yet to be posted to the personal
account of the customer.
iv. The list of debtors’ balances includes P500 which was incorrectly listed as a
credit balance.
v. The debit side of one customer’s account has been under-added by P100.
vi. A debit balance of P1, 318 has been omitted from the list of debtors’
balances.
vii. A purchase ledger contra of P1, 600 had been recorded in the account of the
customer but not in the Control Account.
viii. The business bank statement showed a credit transfer of P4, 000 from a
customer which has been omitted from the books.
ix. The Sales Daybook was over-added by P3, 500.
x. A cheque for P5, 800, received from a customer, has been incorrectly
posted to the customer’s account as P4, 180.
xi. A sales invoice for P11, 000 was omitted from the Sales Daybook.
REQUIRED:
a) Commencing with the balance of P471, 320, prepare a statement showing the
revised balance on the Sales Ledger Control Account following correction of the
various errors and omissions. (10 marks)
b) Commencing with the balance of P455, 082, prepare a statement showing the
revised total of the Sales Ledger balances following correction of the various errors
and omissions. (10
marks)
QUESTION 2
Suggest reasons why there might be a difference between the balance on the receivables
ledger control account and the total the list of accounts receivable ledger balances.
