1.4. Reconciliation and verification
A subsection of Accounting, 9706, through 1. Financial accounting (AS Level)
Listing 10 of 385 questions
The following information is available for a business. The balance on its purchases ledger control account was $5900. The total of the balances in its purchases ledger was $5510. The following errors were discovered. The purchases journal had been overcast by $250. A sales ledger contra of $340 had been omitted from the purchases ledger control account. A supplier was paid $400 which was correctly entered in the cash book but had been entered in the supplier’s account as $200. What is the correct value of trade payables?
9706_s19_qp_11
MCQ
2019
Paper 1, Variant 1
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Cheng, a sole trader, maintains control accounts. REQUIRED Explain two benefits to a business of maintaining control accounts. Additional information At 31 December 2018, Cheng’s bookkeeper prepared a purchases ledger control account and a sales ledger control account. However, the balances of the control accounts did not agree with the total of the individual balances recorded in the relevant ledgers. The details were as follows: $ Purchases ledger Total of ledger accounts 18 496 Control account balance 18 981 Sales ledger Total of ledger accounts 11 117 Control account balance 12 385 Cheng’s bookkeeper has discovered the following: Cash sales of $480 had been recorded in the sales ledger control account. A credit note for $228 had been recorded as $282 in both the purchases returns journal and the supplier’s account. The account of a customer with a balance of $485 had been set off against his account in the purchases ledger. No record of this transaction had been made in the purchases ledger control account. Interest of $67 charged by a trade supplier on an overdue account had not been recorded in the books of account. A dishonoured cheque of $394 had been correctly recorded in the cash book but had been posted to the credit side of the customer’s account. REQUIRED Prepare a corrected: Purchases ledger control account $ $ Balance b/d 18 981 Sales ledger control account $ $ Balance b/d 12 385 Calculate amended totals for the: purchases ledger accounts sales ledger accounts.
9706_s19_qp_23
THEORY
2019
Paper 2, Variant 3
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Hamid prepares control accounts to check the accuracy of his business’s purchases and sales ledgers. REQUIRED Explain two benefits to a business of using control accounts other than checking the arithmetical accuracy of ledger accounts. Additional information On 31 January 2021 Hamid provided the following information: The balance of the sales ledger control account on 1 January 2021 was $17 820. Totals for January 2021 from books of prime entry $ Cash book Discount allowed Receipts from trade receivables 16 230 General journal Contra entries with purchases ledger Sales journal 18 440 Sales returns journal On 31 January 2021 a credit customer had overpaid his account by $170. REQUIRED Prepare the sales ledger control account for January 2021. Sales ledger control account $ $ Additional information On 31 January 2021 the total of balances in the purchases ledger was $12 860, but the balance of the purchases ledger control account on this date was $12 980. The following errors were discovered. The total of the discounts received column of $110 had not been posted from the cash book. The total of the purchases returns journal had been overstated by $250. Interest of $130 charged by a supplier because of an overdue balance had been debited to the supplier’s account. REQUIRED Prepare statements to show corrected totals for: the purchases ledger balances Correction of purchases ledger balances Details $ Incorrect total 12 860 the purchases ledger control account balance Correction of purchases ledger control account balance Details $ Incorrect balance 12 980
9706_s21_qp_23
THEORY
2021
Paper 2, Variant 3
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At 31 December 2021, the sales ledger control account had a balance of $19 100 while the total balances in the sales ledger were $20 900. The following reconciliation statement had been prepared after the errors were located. $ balance of sales ledger control account 19 100 credit sales omitted from the sales journal 1 600 discount allowed understated in sales ledger total of balances in the sales ledger 20 900 What is the correct amount of total trade receivables as shown...
9706_s22_qp_12
MCQ
2022
Paper 1, Variant 2
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Nibras purchases and sells goods for cash and on credit. Control accounts are used to check the accuracy of the business’s purchases and sales ledgers. The following information is available for January 2022. Purchases ledger account balances at 1 January 2022 were: $ Amounts owed to suppliers 23 490 Amount overpaid to one supplier Totals from the books of prime entry were as follows: $ Cash book Cash purchases 18 540 Payments to trade payables 202 950 Discounts received 4 920 Purchases journal 212 480 Returns outwards journal 3 770 General journal Contras to sales ledger There were no overpaid accounts in the purchases ledger at the end of the month. REQUIRED Prepare the purchases ledger control account for January 2022. Purchases ledger control account $ $ Additional information On 31 January 2022 the following information was available concerning trade receivables. $ Balance of the sales ledger control account 25 310 Total of balances in the sales ledger 23 980 The following errors were discovered. When corrected, the total of balances in the sales ledger agreed with the balance of the sales ledger control account. An irrecoverable debt of $540 had been recorded as $450 in both the general ledger and the customer’s sales ledger account. The total of the returns inwards journal, $1390, had been omitted from the sales ledger control account. The balance of a customer’s account had been understated by $120. A credit note, $90, issued to a credit customer had been recorded correctly in the sales return journal but posted to the debit side of the customer’s account. REQUIRED Calculate the correct balance of the sales ledger control account. Calculate the correct total of balances in the sales ledger. Additional information Control accounts do not reveal every type of error. REQUIRED State three types of error which are not revealed by a control account.
9706_s22_qp_23
THEORY
2022
Paper 2, Variant 3
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Questions Discovered
385