ICAEW AF · Chapter 6 · Question 3 of 9
Information about a business's trade payables for the year: opening balance £19,250; credit purchases £143,800; payments to suppliers £137,600; purchase returns £2,900; contra with the receivables ledger £1,600. What is the closing balance on the payables control account?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) £20,950 credit
Explanation
The payables control account normally has a credit balance. Closing balance = £19,250 + £143,800 - £137,600 - £2,900 - £1,600 = £20,950 credit. Purchase returns and contras both reduce the amount owed to suppliers and are debited to the account.
More Control accounts MCQs
- Q5A business both buys from and sells to Fenwick Ltd. It agrees to set off the £1,250 Fenwick owes it against the £3,400 it owes Fenwick…
- Q6Which of the following is a main purpose of maintaining a receivables control account?
- Q7The sales day book for June was undercast by £500. The individual customer accounts were posted correctly. What correction is required?
- Q8A business's receivables control account shows a balance of £41,370, while the list of individual customer balances totals £40,170…
- Q9A business keeps its individual customer accounts as memorandum records outside the double entry system. Where is the double entry for…