Day: May 4, 2024

The payables control account below contains a number of errors:

PAYABLES CONTROL ACCOUNT

DR   Opening balance          £318,600

DR  Cash paid to suppliers   £1,405,500

DR  Refunds received from suppliers  £2,700

DR  Total                          £1,726,800

  CR  Purchases                                £1,268,600

  CR  Discounts received                     £8,200

  CR  Contras with receivables              £48,000

  CR  Closing balance                        £402,000

  CR  Total                                      £1,726,800

What will the closing balance be when the errors have been corrected?

Select ONE answer:

1. £122,800
2. £128,200
3. £144,600
4. £224,200

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 2

1. Notcorrect
2. Correct – DRs  Cash paid to suppliers £1,405,500, Contras with receivables £48,000, Discounts received  £8,200  Closing Balance £128,200 Total 1,589,900  CRs Opening balance £318,600, Purchases £1,268,600, Cash refunds £2,700  Total 1,589,900
3. Not correct
4. Not correct

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