QUESTION 4 (27 Marks) The following is an extract from the general ledger of Smart Boutique for December 20.1: Financial Accounting 1 Page 5 of 8 TRADE RECEIVABLES CONTROL DR CR 20.1 R 20.1 Dec 15 670 Dec 31 1 Balance (Correct) b/d Bank (total: trade receivables column) Settlement discount granted. 45 495 Sales Returns (credit sales) 2 220 Bank (R/D Cheques) 425 Credit purchases 33 801 Cash purchases 1 008 Settlement discount 275 31 685 Credit Sales 48 165 3 980 150 Drawings Purchases received Bank (Total: trade payables column) Balance cld returns 2 131 70 587 (credit purchases) 112 296 112 296 Balance bld 70587 20.2 Jan 1 . Additional information: 1. An inexperienced bookkeeper prepared the trade receivables control account. 2. In addition to the errors made in the trade receivables control account above, an investigation revealed the following: The total of the trade receivables balances as per the list of trade receivables on 31 December 20.1 amounted to R16 060. An amount of R115, which has been written off as credit losses, has erroneously been added to the credit sales amount of R48 165. This entry has been posted correctly to the applicable account in the trade receivables ledger. The sales journal was overcast by R420. Credit sales of R170 was posted correctly to the sales account and the trade receivables control account in the general ledger but was not posted to the specific debtor's account in the trade receivables ledger. Credit note number 003 for R70 was recorded correctly in the sales returns journal but posted to the wrong side of the personal account of the debtor in the trade receivables ledger. . Financial Accounting 1 Page 6 of 8 6/8