Acca financial Accounting (FA) Study Text ac ca (FA)

Chapter 14 

KAPLAN PUBLISHING

249 

Step 5 

Here it is clear that the error affects the control account, not the 

payables’ ledger. Correction should be made by the bookkeeping entry: 

Dr Payables’ ledger control account 

$X 

Cr Receivables’ ledger control account  $X 

Payables’ ledger control account 

20X9

$ 

20X9

$

Discount received 

1,715  31 Mar 

Receivables ledger 

control – contra 

2,004 Balance 

b/f 

21,832 

Balance c/f 

20,113  Purchase day book 

casting 

2,000 

––––––

––––––

23,832

23,832

Reconciliation of individual balances with control account balance 

Cr 

$

Balances as extracted 

19,766 

Credit balance incorrectly treated (2 × $205) 

410 

Petty cash payment 

(63) 

––––––

Net total agreeing with control account 

20,113 

Test your understanding 3 

Rayneydaze is a business selling umbrellas branded with corporate 

logos. The umbrellas are sold on credit, rather than for cash. The 

accountant is carrying out a reconciliation of the receivables’ ledger 

control account balance, which is $172,000 to the total of the balances 

on the individual accounts in the receivables’ ledger, which is $176,134. 

The following has been found: 

1 

A contra item of $1,500 has not been entered in the receivables’ 

ledger control account. 

2 

A cheque for $555 from a customer has been dishonoured. The 

correct double entry has been posted but the individual accounts 

have not been updated. 

3 

A payment of $322 from a customer has incorrectly been entered 

in the accounts receivable ledger as $233. 

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