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Homework Control accounts A' level

The document provides financial data for William Noel's Purchases Ledger for the year ending April 30, 2007, including balances, purchases, payments, and errors. It outlines tasks such as reasons for maintaining control accounts, creating a Purchases Ledger Control Account, and adjusting for discrepancies found in the ledger. The document also specifies the need to reconcile the Purchases Ledger balance with the control account after identifying various errors.

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amazemwashita191
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6 views1 page

Homework Control accounts A' level

The document provides financial data for William Noel's Purchases Ledger for the year ending April 30, 2007, including balances, purchases, payments, and errors. It outlines tasks such as reasons for maintaining control accounts, creating a Purchases Ledger Control Account, and adjusting for discrepancies found in the ledger. The document also specifies the need to reconcile the Purchases Ledger balance with the control account after identifying various errors.

Uploaded by

amazemwashita191
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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1.

The following information was extracted from books of William Noel for the year ended 30
April 2007:
$
Purchases Ledger balance at 1 May 2006 43 120
Credit purchases for the year 824 140
Credit purchases returns 12 400
Cheques paid to creditors 745 980
Cash purchases 8 940
Discount received on credit purchases 31 400
Credit balances transferred to Sales Ledger accounts 5 210

a. Outline three reasons for keeping control accounts. [6]


b. Draw up the Purchases Ledger Control Account for the year ended 30 April 2007. [6]
c. The total of the balances in William Noel’s Purchases Ledger amounts to $67 660, which
does not agree with the closing balance in the control account.
The following errors were then discovered:
i. Discount received had been overstated by $1 000.
ii. A credit purchases invoice for $2 040 had been completely omitted from the
books.
iii. A Purchases Ledger account had been understated by $100.
iv. A credit balance of $850 in the Purchases Ledger had been set off against a
contra entry in the Sales Ledger, but no entry had been made in the control
accounts.
v. A payment of $1 450 was debited to the creditor’s account but was omitted from
the Bank Account.
vi. A credit balance of $3 210 had been omitted from the list of creditors.
ci. Extract the necessary information from the above list and draw up an
amended Purchases Ledger Control Account for the year ended 30 April
2007. [4]
cii. Beginning with the given total of $67 660, draw up a table showing
changes to be made in the Purchases Ledger to reconcile it with the new
control account balance. [3]

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