QUESTION 3 CREDITORS RECONCILIATION (20) The information given below was extract

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

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.

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

Explanation / Answer

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

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