At 1 May 20X8, the payables ledger control account showed a balance of $35,580.
At the end of May the following totals are extracted from the subsidiary books for May:
| $ | |
| Purchases day book | 45,950 |
| Returns outwards day book | 6,873 |
| Returns inwards day book | 3,310 |
| Payments to payables, after deducting $358 cash discount | 49,090 |
It is also discovered that:
(a)The purchase day book figure is net of sales tax at 20%; the other figures all include sales tax.
(b)A customer’s balance of $605 has been offset against his balance of $913 in the payables ledger.
(c)A supplier’s account in the payables ledger, with a debit balance of $200, has been included on the list of payables as a credit balance.
What is the corrected balance on the payables ledger control account?
Answer
| PAYABLES LEDGER CONTROL ACCOUNT | |||
| $ | $ | ||
| Returns outwards | 6,873 | Balance b/f | 35,580 |
| Payments to payables | 49,090 | Credit purchases (45,950 x 1.20) | 55,140 |
| Discount received | 358 | ||
| Contra | 605 | ||
| Balance c/f | 33,794 | – | |
| 90,720 | 90,720 | ||
| Balance b/f | 33,794 | ||