Balances and transactions affecting a company's control accounts for the months of May 19X2 are listed below:
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Balances and transactions affecting a company's control accounts for the months of May 19X2 are listed below:
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Purchases on credit Balances at 1 May 19X2: Sales ledger Purchase ledger Transactions during May 19X2: Allowances from suppliers 9,123 (debit) 211 (credit) 4,490 (credit) 88 (debit) 18,135 629 Receipts from customers by cheque 27,370 Sales on credit 36,755 Discounts received Payments to creditors by cheque Contra settlements Allowances to customers 1,105 15,413 3,046 1,720 Bills of exchange receivable 6,506 Customers' cheques dishonoured 489 Cash receipts from credit customers 4,201 Refunds to customers for overpayment of accounts 53 Discounts allowed 732 Balances at 31 May 19X2: Sales ledger Purchases ledger 136 (credit) 67 (debit) Required: (a) Explain the purposes for which control accounts are prepared. (b) Post the sales ledger and purchases ledger control accounts for the month of May 19X2 and derive the respective debit and credit closing balances on 31 May 19X2. (Association of Certified Accountants)
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