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Control Accounts provide J-Quan Ltd with useful information on sales and purchases.
At the end of January 2021, the following balances were extracted from the companys ledgers:
| Details/Accounts | $ |
| January 1, 2021: | |
| Purchases ledger balance b/d (dr) | 25,000 |
| Sales ledger balance b/d (cr) | 18,700 |
| Sales ledger balance b/d (dr) | 51,400 |
| Purchases ledger balance b/d (cr) | 37,400 |
| January 31, 2021: | |
| Bad debts written off | 30,000 |
| Discount received | 4,600 |
| Set off between sales and purchases ledgers | 4,000 |
| Credit sales for the month | 37,800 |
| Cheques paid to suppliers | 31,000 |
| Interest on overdue customers accounts | 3,500 |
| Cash received from debtors | 29,000 |
| Dishonoured suppliers cheques | 1,500 |
| Discount allowed | 45,000 |
| Cash sales for the month | 12,000 |
| Credit purchases for the month | 24,000 |
| Refunds to credit customers | 2,800 |
| Return inwards | 4,200 |
| Cash purchases | 7,500 |
| Cheques received from accounts receivable | 33,000 |
| Return outwards | 2,400 |
| Cash paid to creditors | 8,900 |
| Interest on overdue suppliers accounts. | 800 |
| Dishonoured customers cheques | 2,000 |
| Bad debt recovery | 3,300 |
Required
(a) Write up the companys Sales Ledger Control accounts for the month of January 2021. (10 marks)
(b) Write up the company Purchases Ledger Control account for the month of January 2021. (8 marks)
(c) Identify TWO (2) reasons why a company would need to do Control Accounts (2 marks)
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