ICAEW AF · Chapter 6 · Question 1 of 9
The following information relates to a business's receivables for the year: Opening balance £28,400 Credit sales £196,500 Cash sales £12,000 Cash received from credit customers £182,300 Irrecoverable debts written off £2,100 Contra with payables ledger £1,600 Sales returns £3,750 What is the closing balance on the receivables control account?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: D) £35,150
Explanation
Closing balance = £28,400 + £196,500 - £182,300 - £2,100 - £1,600 - £3,750 = £35,150. Cash sales never create a receivable, so they do not appear in the control account. The contra and sales returns both reduce the amount owed by customers and are credits in the account.
More Control accounts MCQs
- Q3Information about a business's trade payables for the year: opening balance £19,250; credit purchases £143,800; payments to suppliers…
- Q4The total of the list of balances in a business's payables ledger is £18,640, which does not agree with the payables control account. The…
- 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?