ACCA Applied Knowledge · Financial Accounting · Payables account reconciliations
The payables ledger control account of Delta Ltd has an opening credit balance of $26,400. During the month: purchases on credit were $81,200, payments to suppliers were $74,500, discounts received were $1,300, and purchase returns were $2,900. What is the closing balance on the control account?
The closing balance is $28,900 credit. Start with the opening $26,400, add credit purchases of $81,200, then deduct payments of $74,500, discounts received of $1,300 and returns of $2,900. Payments, discounts and returns all reduce the amount owed to suppliers.
- A$28,900 creditCorrect
- B$29,500 credit
- C$31,500 credit
- D$26,500 credit
Explanation
Closing = 26,400 + 81,200 - 74,500 - 1,300 - 2,900 = 28,900 credit. Check: credits 107,600; debits 78,700; difference 28,900. Option B omits the deduction of discounts of $1,300 and option C wrongly adds returns.
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