Question

QUESTION 3

CREDITORS RECONCILIATION

(20)

The information given below was extracted from the records of Zebro Traders for May 2017.

REQUIRED

3.1

Prepare the correct Creditors Control account for May 2017. Balance the account.

3.2

Prepare the corrected Creditors List as at 31 May 2017.

INFORMATION

Credit balance in the Creditors control account on 01 May 2017 - R256 500

Transactions for May 2017 (excluding the additional information below): R

Merchandise purchased on credit - 660 600

Merchandise purchased by cheque - 446400

Cheques issued to creditors in payment of accounts and discounts received - 642150

Merchandise returned to creditors - 7560

Stationery purchased on account - 14400

Interest charged by a creditor on an overdue account - 270

CREDITORS LIST AT 31 MAY 2017	DEBIT	CREDIT
Union Limited		41 400
Voltex Suppliers		63 180
Tropical Manufacturers		169 200
Southgate Enterprises		30 600
Proworx Wholesalers	2 700
	2700	304380

Additional information not yet recorded:
1.
The balance in the account of Proworx Wholesalers must be transferred to their account in the Debtors ledger.
2.
A credit note received from Union Limited for merchandise returned was not recorded in the Purchases Returns Journal, R8 100.
3.
An invoice received from Tropical Manufacturers for goods purchased was correctly entered in the Purchases journal as R7 500 but erroneously posted to their account as
R9 120 in the Creditors ledger.
4.
An electronic funds transfer to Voltex Suppliers in part settlement of account was not recorded in the Cash Payments Journal, R6 300.
5.
A cheque to Southgate Enterprises for R9 000 was correctly recorded in the Cash Payments Journal but treated as a purchase in the supplier’s account in the Creditors ledger.

Answer 1

Creditor Control a/c
particulars		Amount	Particulars		Amount
payment in may		642150	balance b/d		256500
merchandise return to creditor		7560	merchandise purchase on credit		660600
			interest charged by creditor		270
			Stationary purchased		14400
balance c/d		284760	Debit balance transfer		2700
		934470			934470
creditor list - CORRECTED
Particulars		Balance	Adjustment		final balance	details
Union limited		41400	0		41400	Adjustment no 2 has been posted correctly for creditor
Voltex		63180	0		63180	Adjustment no 4 has been posted correctly for creditor
topical manufacture		169200	(-9120+7500)		167580	adjustment no 3 R9120posted incorrected correct to posted is R7500
Southgate enterprise		30600	(-9000-9000)		12600	adjustement no 5 payment considered as purchase
proworx		2700	-2700		0	adjustment no 1 to be transferred to debtor
					284760