I n t e r a c t I v e t e X t foundations in Accountancy/ acca financial accounting (ffa/FA) bpp learning Media is an acca approved Content Provider

PART E: PREPARING A TRIAL BALANCE 

 

258

 

(b) 

STATEMENT OF ADJUSTMENTS TO LIST OF PERSONAL ACCOUNT BALANCES 

 

$ 

$ 

Original total of list of balances 

 

 

12,802 

Add debit 

balance 

omitted 

(b) 

  

300 

 

 

 debit 

balance 

understated 

(d) 

  

200 

 

 

 

 

     500 

 

 

 

13,302 

Less  transposition error (c): understatement of cash received 

  

180 

 

 

 

cash debited instead of credited (2 × $250) (g) 

  

500 

 

 

 

discounts received wrongly debited to Bell (h) 

 

50 

 

 

 

understatement of cash received (j) 

  

  72 

 

 

 

 

     802 

 

 

 

12,500 

 

QUESTION 

Payables control account

 

ABC has a payables control account balance of $12,500 at 31 December 20X6. However, the extract of 

balances from the payables ledger totals $12,800. Investigation finds the following errors: purchases for 

week 52 of $1,200 had been omitted from the control account; a supplier account of $900 had been 

omitted from the list of balances. 

What is the correct payables balance at 31 December 20X6? 

A $12,500 

B $13,400 

C $12,800 

D $13,700 

ANSWER 

D 

PAYABLES CONTROL ACCOUNT 

 

 

$ 

 

 

$ 

 

 

 

Bal b/d 

 

12,500 

Bal c/d 

 

13,700 

 

Purchases – week 52 

 

  1,200 

 

 

13,700   

 

13,700 

Corrected list of balances: 

 

 

$ 

Original 

 

12,800 

Omitted account 

 

     900 

 

 

13,700 

 

QUESTION 

Payables control account 2

 

XYZ has a payables control account balance of $17,250 at 31 December 20X9. However, the extract of 

balances from the payables ledger totals $14,500. Investigation finds the following errors: a contra entry 

of $750 had been omitted from the control account; an account with a balance of $500 debit had been 

included as $500 credit in the list of balances; and payments totalling $3,000 had been posted to the 

individual accounts but the double entry postings had not yet been made. 

Required 

(a) 

Prepare a corrected payables control account, bringing down the amended balance as at 

31 December 20X9. 

(b) 

Prepare a statement showing the adjustments that are necessary to the list of personal account 

 

balances so that it reconciles with the amended payables control account balance. 

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CHAPTER 14  

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  CONTROL ACCOUNTS 

 

259 

ANSWER 

(a) 

PAYABLES CONTROL ACCOUNT 

 

 

$ 

 

 

$ 

Contra entry omitted 

750 

 

Bal b/d 

 

17,250 

Payment omitted  

3,000 

 

 

Bal c/d 

 

13,500   

 

 

 

17,250   

 17,250

 

 

 

Bal b/d 

13,500 

(b) 

STATEMENT OF ADJUSTMENTS TO LIST OF PERSONAL ACCOUNT BALANCES 

 

 $ 

Original 

 14,500 

Less debit balance entered as credit (2  $500) 

   1,000 

Amended total 

 13,500 

 

 

 

 

 

 

 

 EXAM FOCUS POINT 

The ACCA examining team has highlighted control accounts as one of the areas poorly answered in 

recent exams. 

The key to carrying out reconciliations is to ask yourself the following questions: 

 

What is the correct entry? 

 

What entries were actually made? 

 

What corrections are needed? 

In the July to December 2016 exams, the ACCA examining team have included an example on control 

accounts in Example 2. The examining team have stated that this example has been chosen to help 

future candidates understand some of the questions that candidates found difficult. Therefore it is 

important for you to carefully review how the correct answer is derived. 

One of the requirements of performance objective PO6 Record and process transactions and events, is 

to 'verify, input, and process routine financial accounting data within the accounting system'. This 

chapter of the Interactive Text will help you fulfil this requirement. 

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