Chidubem Stores operates a dual ledger system and maintains control accounts. On 1st Novem… — JAMB UTME

Chidubem Stores operates a dual ledger system and maintains control accounts. On 1st November 2025, the Sales Ledger Control Account had a debit balance of $\text{N}218,500$ . During November 2025, the following transactions were recorded:

- Credit sales: $\text{N}340,000$
- Cash and cheques received from debtors: $\text{N}295,000$
- Returns inwards: $\text{N}12,500$
- Discounts allowed: $\text{N}8,000$
- Bad debts written off: $\text{N}6,000$
- Customer dishonoured cheque: $\text{N}15,000$
- Contra entry set-off between sales ledger and purchases ledger: $\text{N}22,000$

What is the closing debit balance of the Sales Ledger Control Account as at 30th November 2025?

Answer: 230000 NGN

Answer

The closing debit balance of the Sales Ledger Control Account as at 30th November 2025 is N230,000.

The correct closing balance of

\text{N}230,000

is calculated by starting with the opening debit balance of

\text{N}218,500

, adding items that increase trade debt (Credit Sales of

\text{N}340,000

and Dishonoured Cheque of

\text{N}15,000

), and subtracting items that reduce trade debt (Cheques Received of

\text{N}295,000

, Returns Inwards of

\text{N}12,500

, Discounts Allowed of

\text{N}8,000

, Bad Debts of

\text{N}6,000

, and the Contra Set-off of

\text{N}22,000

Step-by-Step Solution

Calculate the total debit side entries of the Sales Ledger Control Account

\text{N}218,500 + \text{N}340,000 + \text{N}15,000 = \text{N}573,500

Opening debit balance, credit sales, and dishonoured cheques increase the debt owed by customers and are debited to the control account.

Calculate the total credit side entries of the Sales Ledger Control Account

\text{N}295,000 + \text{N}12,500 + \text{N}8,000 + \text{N}6,000 + \text{N}22,000 = \text{N}343,500

Cheques received, returns inwards, discounts allowed, bad debts written off, and contra set-offs reduce the amount owed by trade debtors and are credited to the sales ledger control account.

Deduct total credit entries from total debit entries to determine the closing balance

\text{N}573,500 - \text{N}343,500 = \text{N}230,000

The net result represents the remaining debit balance carried down to the next period.

Key Concept

Contra entries and set-offs in Sales Ledger Control Account

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