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Control Accounts. Four main control accounts –Sales Ledger Control Account –Purchase Ledger Control Account –VAT Control Account –Wages Control Account.

Published byGavin Calvin Reed Modified over 9 years ago

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Presentation on theme: "Control Accounts. Four main control accounts –Sales Ledger Control Account –Purchase Ledger Control Account –VAT Control Account –Wages Control Account."— Presentation transcript:

1 Control Accounts

2 Four main control accounts –Sales Ledger Control Account –Purchase Ledger Control Account –VAT Control Account –Wages Control Account

3 What books of prime entry records information about ‘Credit Sales’? Sales day book Sales returns day book Cash book

4 Sales Ledger Control Account This reconciles the totals of a number of subsidiary accounts. -Credit sales from sales day book -Sales returns from sales returns day book -Payments received from the cash book -Settlement discount allowed from the cash book Queston 1

5 Question 1

6 Sales Day Book (SD21) DateCustomer Invoice numberFolioGrossVATNet 03-MayA45SL01240.0040.00200.00 05-MayC46SL02144.0024.00120.00 08-MayB47SL03180.0030.00150.00 15-MayC48SL04264.0044.00220.00 20-MayB49SL05120.0020.00100.00 28-MayA50SL06216.0036.00180.00 Total

7 Question 1 Sales Day Book (SD21) DateCustomer Invoice numberFolioGrossVATNet 03-MayA45SL01240.0040.00200.00 05-MayC46SL02144.0024.00120.00 08-MayB47SL03180.0030.00150.00 15-MayC48SL04264.0044.00220.00 20-MayB49SL05120.0020.00100.00 28-MayA50SL06216.0036.00180.00 Total1164.00194.00970.00

8 Cashbook DRCash Book - Debit Side - Receipts DateDetailsRefBankVAT Discount Allowed Cash Sales Trade Receivab les 06-MayBSL02117.50 10-MayASL01225.60 9.40 225.60 13-MayCSL03200.00 20-MayASL01225.60 9.40 225.60 28-MayCSL03100.00 30-MayBSL02176.25 Totals General Ledger Account Debit Entry Credit Entry

9 Cashbook DRCash Book - Debit Side - Receipts DateDetailsRefBankVAT Discount Allowed Cash Sales Trade Receivab les 06-MayBSL02117.50 10-MayASL01225.60 9.40 225.60 13-MayCSL03200.00 20-MayASL01225.60 9.40 225.60 28-MayCSL03100.00 30-MayBSL02176.25 Totals 1044.950.0018.800.001044.95 General Ledger Account Debit Entry Bank Discounts Allowed Credit Entry VAT Trade Receivables

10 Purchases Ledger Control Account This reconciles the totals of a number of subsidiary accounts. -Credit purchases from purchases day book -Purchases returns from purchases returns day book -Payments made from the cash book -Settlement discount received from the cash book Question 2

11 Customer Invoice Number Supplier Code Invoice Total £ VAT £ Net £ Rowley Ltd7869PL 543000.00500.002500.00 Jipsum plc323980PL 023840.00640.003200.00 Total Purchase Day Book Customer Invoice Number Supplier Code Invoice Total £ VAT £ Net £ Rowley LtdCN627PL 5496.0016.0080.00 Jipsum plcCN08PL 02480.0080.00400.00 Total Purchase Returns Day Book

12 Question 2 Customer Invoice Number Supplier Code Invoice Total £ VAT £ Net £ Rowley Ltd7869PL 543000.00500.002500.00 Jipsum plc323980PL 023840.00640.003200.00 Total6840.001140.005700.00 Purchase Day Book Customer Invoice Number Supplier Code Invoice Total £ VAT £ Net £ Rowley LtdCN627PL 5496.0016.0080.00 Jipsum plcCN08PL 02480.0080.00400.00 Total576.0096.00480.00 Purchase Returns Day Book

13 Question 2 Cashbook DetailsRef Bank £ Vat £ Discount Received £ Cash purchases £ Purchase Ledger £ Sundry £ Rowley LtdPL 542843.50 Jipsum plcPL 023125.50140.003125.50 Cash Purchase 720.00120.00600.00 Total General ledger account Debit entry Credit entry

14 Question 2 Cashbook DetailsRef Bank £ Vat £ Discount Received £ Cash purchases £ Purchase Ledger £ Sundry £ Rowley LtdPL 542843.50 Jipsum plcPL 023125.50140.003125.50 Cash Purchase 720.00120.00600.00 Total6689.00120.00140.00600.005969.000 General ledger account Debit entry Credit entry

15 Question 2 Cashbook DetailsRef Bank £ Vat £ Discount Received £ Cash purchases £ Purchase Ledger £ Sundry £ Rowley LtdPL 542843.50 Jipsum plcPL 023125.50140.003125.50 Cash Purchase 720.00120.00600.00 Total6689.00120.00140.00600.005969.000 General ledger account Debit entry VATPLCAPurchasesPLCA Credit entryBank

16 Question 3 The following company has 4 credit customers. The opening balances on their debtors accounts at 01/05 are as follows: Virgo Partners227.57 McGowan and Son552.73 JJ Westrope317.59 Jacks Ltd118.36 Total1216.25 Enter the openng balances in to the Sales Ledger Accounts and the SLCA

17 Question 3 - Answer Reconciliation of Sales Ledger to Sales Ledger Control Account Sales Ledger Control Account Balance1764.97 Sales Ledger Balances Virgo Partners421.38 McGowan & Son595.09 JJ Westrope444.73 Jacks Ltd303.77 1764.97

18 Sales Ledger Control Account Reconciliation Periodic check between the balance on the sales ledger control account and the total of the individual balances on the sales ledger accounts. Total of balances on sales ledger accounts Sales Ledger Control Account Debtors Control Trade Receivables Balance c/d

19 DrCr DateDetails£DateDetails£ Sales Control Account Activity Q4

20 DrCr DateDetails£DateDetails£ 01-JanBalance b/f1894.00 Sales Control Account Activity Q4

21 DrCr DateDetails£DateDetails£ 01-JanBalance b/f1894.00 SDB10290.00 Sales Control Account Activity Q4

22 DrCr DateDetails£DateDetails£ 01-JanBalance b/f1894.00 CB7284.00 SDB10290.00 Sales Control Account Activity Q4

23 DrCr DateDetails£DateDetails£ 01-JanBalance b/f1894.00 CB7284.00 SDB10290.00 CB1236.00 Sales Control Account Activity Q4

24 DrCr DateDetails£DateDetails£ 01-JanBalance b/f1894.00 CB7284.00 SDB10290.00 CB1236.00 SRDB296.00 Sales Control Account Activity Q4

25 DrCr DateDetails£DateDetails£ 01-JanBalance b/f1894.00 CB7284.00 SDB10290.00 CB1236.00 SRDB296.00 12184.00 Sales Control Account Activity Q4

26 DrCr DateDetails£DateDetails£ 01-JanBalance b/f1894.00 CB7284.00 SDB10290.00 CB1236.00 SRDB296.00 Balance c/d3368.00 12184.00 Sales Control Account Activity Q4

27 DrCr DateDetails£DateDetails£ 01-JanBalance b/f1894.00 CB7284.00 SDB10290.00 CB1236.00 SRDB296.00 Balance c/d3368.00 12184.00 Balance b/d3368.00

28 Question 4 DrSales Ledger Control AccountCr DateDetails£DateDetails£ 01-JanBalance b/d1894.00 CB7284.00 SDB10290.00 CB1236.00 SRDB296.00 Balance c/d3368.00 12184.00 Balance b/d3368.00

29 Questions 5 & 6

30 Question 7 DrSales Ledger Control AccountCr DateDetails£DateDetails£

31 Why Reconcile?

32 Purchase Ledger Control Account Try questions 9, 10 & 11

33 VAT Control Account Used to help prepare the VAT return. The balance on the VAT control account should equal the amount on the VAT return. Balance could be a debit (if amount collected from VAT on sales is less than the VAT paid on purchases) Balance could be a credit (if amount collected from VAT on sales is more than the VAT paid on purchases) Information in the control account is obtained from the books of prime entry What books of prime entry would we use? And what information is contained in them that we would use?

34 VAT Control Account Dr Cr

35 VAT Control Account Dr Cr Balance b/dX

36 VAT Control Account Dr Cr VAT on credit purchaseXBalance b/dX VAT on cash purchaseX

37 VAT Control Account Dr Cr VAT on credit purchaseXBalance b/dX VAT on cash purchaseXVAT on credit salesX

38 VAT Control Account Dr Cr VAT on credit purchaseXBalance b/dX VAT on cash purchaseXVAT on credit salesX VAT on petty cash purchasesX

39 VAT Control Account Dr Cr VAT on credit purchaseXBalance b/dX VAT on cash purchaseXVAT on credit salesX VAT on petty cash purchasesXVAT on cash salesX

40 VAT Control Account Dr Cr VAT on credit purchaseXBalance b/dX VAT on cash purchaseXVAT on credit salesX VAT on petty cash purchasesXVAT on cash salesX VAT on sales returnsX

41 VAT Control Account Dr Cr VAT on credit purchaseXBalance b/dX VAT on cash purchaseXVAT on credit salesX VAT on petty cash purchasesXVAT on cash salesX VAT on sales returnsXVAT on purchase returnsX

42 VAT Control Account Dr Cr VAT on credit purchaseXBalance b/dX VAT on cash purchaseXVAT on credit salesX VAT on petty cash purchasesXVAT on cash salesX VAT on sales returnsXVAT on purchase returnsX VAT on recoverable debts written off X

43 VAT Control Account Dr Cr VAT on credit purchaseXBalance b/dX VAT on cash purchaseXVAT on credit salesX VAT on petty cash purchasesXVAT on cash salesX VAT on sales returnsXVAT on purchase returnsX VAT on recoverable debts written off XVAT refunded by HMRCX

44 VAT Control Account Dr Cr VAT on credit purchaseXBalance b/dX VAT on cash purchaseXVAT on credit salesX VAT on petty cash purchasesXVAT on cash salesX VAT on sales returnsXVAT on purchase returnsX VAT on recoverable debts written off XVAT refunded by HMRCX VAT paid to HMRC

45 VAT Control Account Dr Cr VAT on credit purchaseXBalance b/dX VAT on cash purchaseXVAT on credit salesX VAT on petty cash purchasesXVAT on cash salesX VAT on sales returnsXVAT on purchase returnsX VAT on recoverable debts written off XVAT refunded by HMRCX VAT paid to HMRCX

46 VAT Control Account ££ Credit Purchases750Credit Sales900 Sales returns10Purchase returns5 Cash purchases150Cash Sales200 Balance c/d195 1105 Balance B/d195

47

48 Question 18 Errors!

49 Errors & the SLCA i.e. your Sales Ledger does not balance with the SLCA DrSales Ledger Control AccountCr DateDetails£DateDetails£

50 Errors & the SLCA i.e. your Sales Ledger does not balance with the SLCA DrSales Ledger Control AccountCr DateDetails£DateDetails£ June Balance b/d41,774

51 a) The SDB was under cast by £100 DrSales Ledger Control AccountCr DateDetails£DateDetails£ June Balance b/d41,774

52 a) The SDB was under cast by £100 DrSales Ledger Control AccountCr DateDetails£DateDetails£ June Balance b/d41,774 JuneSDB under cast100

53 DrSales Ledger Control AccountCr DateDetails£DateDetails£ June Balance b/d41,774 JuneSDB under cast100 b) A page from the SRDB was not posted £450

54 DrSales Ledger Control AccountCr DateDetails£DateDetails£ June Balance b/d41,774JuneSRDB450 JuneSDB under cast100 b) A page from the SRDB was not posted £450

55 DrSales Ledger Control AccountCr DateDetails£DateDetails£ June Balance b/d41,774JuneSRDB450 JuneSDB under cast100 c) An invoice from SDB has been posted as to the Sales Ledger as £769 instead of the correct figure of £679

56 DrSales Ledger Control AccountCr DateDetails£DateDetails£ June Balance b/d41,774JuneSRDB450 JuneSDB under cast100 d) A discount allowed to one customer of £16 has been entered on the wrong side of the Sales Ledger

57 DrSales Ledger Control AccountCr DateDetails£DateDetails£ June Balance b/d41,774JuneSRDB450 JuneSDB under cast100 e) An irrecoverable debt of £210 has been written off in the customers individual account but not in the SLCA

58 DrSales Ledger Control AccountCr DateDetails£DateDetails£ June Balance b/d41,774JuneSRDB450 JuneSDB under cast100JuneBad Debt210 e) An irrecoverable debt of £210 has been written off in the customers individual account but not in the SLCA

59 DrSales Ledger Control AccountCr DateDetails£DateDetails£ June Balance b/d41,774JuneSRDB450 JuneSDB under cast100JuneBad Debt210 f) A credit balance of £125 in the sales ledger had been listed as a debit balance

60 DrSales Ledger Control AccountCr DateDetails£DateDetails£ June Balance b/d41,774JuneSRDB450 JuneSDB under cast100JuneBad Debt210 41,874 Balance the SLCA

61 DrSales Ledger Control AccountCr DateDetails£DateDetails£ June Balance b/d41,774JuneSRDB450 JuneSDB under cast100JuneBad Debt210 JuneBalance c/d41,214 41,874 July Balance b/d41,214 Balance the SLCA

62 Sales Ledger£ Original total of balances Amended list of balances Amended Sales Ledger Control A/C

63 Sales Ledger£ Original total of balances41,586 Amended list of balances Amended Sales Ledger Control A/C

64 Sales Ledger£ Original total of balances41,586 Amended list of balances Amended Sales Ledger Control A/C41,214

65 Sales Ledger£ Original total of balances41,586 Amended list of balances Amended Sales Ledger Control A/C41,214

66 Sales Ledger£ Original total of balances41,586 c)-90 Amended list of balances Amended Sales Ledger Control A/C41,214

67 Sales Ledger£ Original total of balances41,586 c)-90 d)-32 Amended list of balances Amended Sales Ledger Control A/C41,214

68 Sales Ledger£ Original total of balances41,586 c)-90 d)-32 f)-250 Amended list of balances Amended Sales Ledger Control A/C41,214

69 Sales Ledger£ Original total of balances41,586 c)-90 d)-32 f)-250 Amended list of balances41,214 Amended Sales Ledger Control A/C41,214

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