ACCA FA · Chapter 8 · Question 7 of 10
A business provides the following information about trade payables for the year: Opening balance $31,200 Credit purchases $214,000 Cash paid to suppliers $205,600 Discounts received $2,400 Purchase returns $3,800 Contra with receivables ledger $1,500 What is the closing balance on the payables control account?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) $31,900
Explanation
Closing payables = $31,200 + $214,000 - $205,600 - $2,400 - $3,800 - $1,500 = $31,900. All of the payments, discounts, returns and the contra reduce the amount owed. Omitting the contra gives $33,400 and omitting the discounts gives $34,300.
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