Creditors Control and
Creditors List Question
Q: The information below was extracted from the records of Mermaid Traders for May 2011.
Creditors control balance on 30 April 2011 was 42,750.Transactions during May 2011 (excluding the additional information below):
Purchases of trading inventory on credit 110,000
Cash purchases of trading inventory 74,400
Cheques issued to creditors in payment of accounts 105,150
Discounts received from creditors for prompt payment 1,875
Trading inventory returned to creditors 1,260
Furniture purchased on account 2,400
Interest charged by creditor on overdue account 45Creditors List on May 2011:
Creditor Debit Credit
Redco Manufacturers 6,900 (CR)
Arrow Wholesalers 10,530 (CR)
Starlite Traders 28,200 (CR)
Winston Limited 5,100 (CR)
Rory Stores 450 (DR)Additional Information:
1. The balance in the account of Rory Stores must be transferred to their account in the Debtors Ledger.
2. A cheque payment to Redco Manufactures in part settlement of account was not recorded in the Cash payments journal: 1,350. Consequently the posting was also not done.
3. A cheque for 1,270 to Starlite Traders was correctly recorded in the Cash payments journal but posted to their account as 1,000 in the Creditors Ledger.
4. A credit note received from Arrow Wholesalers for trading goods returned was not recorded in the Purchases returns journal, 1,050.
5. A cheque to Winston Limited for 3,000 was recorded in the Cash Payments Journal but not posted to the account in the creditor's ledger.Required:
1. Prepare the correct creditors control account for May 2011. Balance the account.
2. Prepare the corrected Creditor's List as at 31 May 2011.