IGCSE ACCOUNTING 6.3.4 Control Accounts Learning Objectives – Understand the purpose of sales ledger and purchase ledger control accounts – Identify sources of information for control accounts – To be able to prepare simple sales ledger and purchase ledger control account THE BIG PICTURE Accounting life cycle Source Documents Classify business transactions Books of Prime Entry Purchase Day Book Purchase Returns Sales Sales Returns Cash Day Book Day Book Day Book Book Purchase Ledger Sales Ledger Trial balance Financial Statements General Journal General Ledger CONTROL ACCOUNTS Helps to check the arithmetical accuracy of part of the accounting system Transactions in the ledger are summed up and recorded in the respective control account Purchase Ledger Control Account Sales Ledger Control Account Debtor A Debtor B Debtor C Creditor A Creditor B Creditor C Sales Ledger Control Account/Total Debtors Account 2010 May 1 Balance b/d $ 2010 1050 May 31 Dis allowed (800+250) May 31 Sales (250+150) May 31 Bank 400 (730+430) May 31 Balance c/d (70+150) 1450 $ 70 1160 212 0 1450 H Spencer Account $ 2010 $ 2010 May 1 Balance b/d 800 May 21 Dis allowed 70 May 21 Bank 730 800 800 B Smart Account $ 2010 2010 May 1 Balance b/d 250 May 29 Bank May 7 Sales $ 430 250 May 31 Balance c/d 70 500 500 C Bailey Account $ $ 2010 2010 May 20 Sales 150 May 31 Balance c/d 150 150 150 ASSETS LIABILITIES CREDIT INCOME CAPITAL L I C CREDIT L I C DEBIT EXPENSE DEBIT A E DEBIT A E CREDIT Match the key terms 8 minutes Quiz Sources of information Transactions Source of information Total credit sales Sales journal Total receipts Cash book Total discounts allowed Cash book Sales returns Sales returns journal Bad debts General journal FORMAT Sales Ledger Control Accounts Or Total Trade Receivables Accounts Customers a/c $ Balance b/d xxx Credit sales xxx Customers a/c $ Cash xxx Discount allowed xxx Sales returns xxx Bad debts xxx Balance c/d xxx Now, let’s try a question In your group record the entries for question 1 Sources of information Transactions Source of information Total credit purchases Purchases journal Total payments Cash book Total discounts received Cash book Total purchases returned Purchases returns journal Purchase Ledger Control Accounts FORMAT $ Balance c/d $ Now, let’s try a question – Pair with the partner next to you – Record the entries for question 2 Let’s summarize https://www.powtoon.com/online-presentation/ cC1y3cgMwDV/?mode=movie#/ Learning outcome –What are control accounts –Types of control accounts –Sales ledger control accounts –Purchase ledger control accounts –Benefits –Limitations Learning outcome https://padlet.com/leelasunnil02/leela Purchase Ledger Control Accounts FORMAT Sales Ledger Control Accounts FORMAT