Question

QUESTION FIVE The following information was obtained from the financial records of J Moody. The information is in respect of month ended 31 May 2020. R The following are totals extracted from the relevant journals for the month ended 31 May 2020: Sales journal (Trade receivables column). 41 000 Cash receipts journal: Trade receivables column 34 720 Settlement discount granted column 2 940 Sales returns journal (Trade receivables column). 3 280 Purchases journal (Trade payables column). 26 840 Purchases returns journal (Trade payables column). General journal: 4 390 Credit losses written off. Debit balances from Trade payables ledger transferred to 1 400 Accounts in the trade receivable ledger. Interest charged on overdue accounts. 490 520 Additional information: 1. The balance of trade receivables control account at 30 April 2020 was R39 380. 2. The total of the list of trade receivables at 31 May 2020 is R32 460. 3. An amount of R150 received from N Peter in full settlement of his account was analysed as sales in the cash receipts journal. 4. An invoice dated 16 May 2020 issued to K Lever was overstated by R2 000. The invoice was entered into the sales journal at the overstated amount. Required: Prepare the trade receivables control account at 31 May 2020 properly balanced. Each entry must indicate the correct contra ledger account.

Answer 1

Dr Cr Amount Date 31st May 34720 2940 Trade Receivables control account Particulars Amount Date Particulars 31st May To Balance b/f 39380 By Cash To Sales 41000 By dsicount allowed To Trade Payable 490 BY Sales-return To Interest charged 520 BY Bad-Debts By Sales By Sales By provision to doubtful debts By balance c/f 81390 3280 1400 150 2000 4440 32460 81390