Control Accounts (Copy)
Cheat Sheet: 3.4 Control Accounts
O Level and IGCSE Accounting – Quick Revision
What Are Control Accounts?
| Type | Purpose |
|---|---|
| Sales Ledger Control A/C | Summary account of trade receivables (debtors) |
| Purchases Ledger Control A/C | Summary account of trade payables (creditors) |
- Acts as a check on individual ledgers
- Helps in detecting errors and verifying totals
- Not part of the double-entry system
Source of Entries
| Transaction | Book of Prime Entry |
|---|---|
| Credit Sales | Sales Journal |
| Credit Purchases | Purchases Journal |
| Sales Returns | Sales Returns Journal |
| Purchases Returns | Purchases Returns Journal |
| Receipts from customers | Cash Book (Receipts side) |
| Payments to suppliers | Cash Book (Payments side) |
| Discounts allowed | Cash Book |
| Discounts received | Cash Book |
| Irrecoverable Debts | General Journal |
| Refunds to customers | Cash Book (Payments side) |
| Refunds from suppliers | Cash Book (Receipts side) |
| Interest charged | General Journal |
| Dishonoured Cheques | General Journal |
| Contra Entries | General Journal |
Sales Ledger Control Account (Debtors Control A/C)
| Dr (Increase Receivables) | Cr (Decrease Receivables) |
|---|---|
| Opening balance (debit) | Cash received from customers |
| Credit sales | Discounts allowed |
| Dishonoured cheques | Sales returns |
| Interest charged on overdue accounts | Irrecoverable debts written off |
| Contra entries | |
| Refunds given | |
| Closing balance (debit) |
Example Format – Sales Ledger Control A/C
| Date | Details | Dr ($) | Cr ($) |
|---|---|---|---|
| 01 Jan | Balance b/d | 6,000 | |
| Credit Sales | 15,000 | ||
| Dishonoured Cheques | 500 | ||
| Interest Charged | 200 | ||
| Cash Received | 10,000 | ||
| Discounts Allowed | 800 | ||
| Sales Returns | 700 | ||
| Irrecoverable Debts | 300 | ||
| Contra | 400 | ||
| Refunds Given | 100 | ||
| 31 Jan | Balance c/d | 9,400 |
Purchases Ledger Control Account (Creditors Control A/C)
| Cr (Increase Payables) | Dr (Decrease Payables) |
|---|---|
| Opening balance (credit) | Cash paid to suppliers |
| Credit purchases | Discounts received |
| Dishonoured cheques paid to us | Purchases returns |
| Contra entries | Refunds from suppliers |
| Interest charged by suppliers | |
| Closing balance (credit) |
Example Format – Purchases Ledger Control A/C
| Date | Details | Dr ($) | Cr ($) |
|---|---|---|---|
| 01 Jan | Balance b/d | 4,000 | |
| Credit Purchases | 12,000 | ||
| Dishonoured Cheques | 600 | ||
| Interest Charged | 150 | ||
| Cash Paid | 8,000 | ||
| Discounts Received | 700 | ||
| Purchases Returns | 500 | ||
| Refunds Received | 100 | ||
| Contra | 400 | ||
| 31 Jan | Balance c/d | 7,050 |
Contra Entries
- When a customer is also a supplier
- Offsets the amount payable with amount receivable
- Same value debited in Purchases Ledger Control A/C and credited in Sales Ledger Control A/C
Summary Table
| Term | Meaning |
|---|---|
| Control Account | Summary of all trade receivable/payable accounts |
| Receivables (Dr) | Amounts owed to the business |
| Payables (Cr) | Amounts owed by the business |
| Contra Entry | Adjustment where customer is also a supplier |
| Source of Entries | Books of prime entry (e.g., sales/purchases journal, cash book) |