Page 249 - F3 -FA Integrated Workbook STUDENT 2018-19

Incomplete records

Example 2

Ledger account to derive missing information

Foxtrot does not maintain a full set of accounting records and needs to
identify the total cost of purchases made on credit during 20X3. It had trade
payables outstanding of $45,234 at 1 January 20X3, and $48,321 at
31 December 20X3. Payments made to suppliers during 20X3 totalled
$590,164, and discount received for early settlement was $5,729. Returns
outwards during the year amounted to $3,600. In addition, a contra of $4,500
had been agreed with a supplier who was also credit customer of Foxtrot.

Required:

Prepare a trede payables’ ledger control account for 20X3 and derive
Foxtrot’s total cost of purchases for 20X3.

Solution

Trade payables’ ledger control account
Details $ Date Details $

20X3 Cash paid 590,164 1.1.X3 Balance b/f 45,234
20X3 Disc rec’d 5,729

20X3 RLCA contra 4,500 20X3 Purchases (bal fig) 607,080
20X3 Returns out 3,600

31.12.X3 Balance c/f 48,321
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652,314 652,314

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