Construction of control accounts

Construction of control accounts

The information for constructing each control accounts are taken from both the personal accounts of debtors and creditors, as well as information form the main daybooks (e.g. sales daybook for total of credit sales). The main sources of information are found in the following locations:

Information for sales ledger control account

Information needed:	Information located:
Opening balance of debtors	Debtor accounts in sales ledger
Credit sales	Sales daybook
Returns inwards	Returns inwards daybook
Money received from customers	Cashbook
Discounts allowed	General ledger or cashbook (3rd column)
Closing balance of debtors	Debtor accounts n sales ledger

Information for purchases ledger control account

Information needed:	Information located:
Opening balance of creditors	Creditor accounts in purchases ledger
Credit purchases	Sales daybook
Returns outwards	Returns outwards daybook
Money received from customers	Cashbook
Discounts received	General ledger or cashbook (3rd column)
Closing balance of creditors	Creditor accounts in purchases ledger

A control account will appear as if it is a personal account - with amounts relating to purchases and sales, returns, discounts as well as payments made and received. The examples below are to remind you of what a debtor and what a creditor account looks like:

Debtor accounts

Balance owing to us at start	Cash/cheques received
Credit sales made during period	Returns inwards
-	Discounts allowed
-	Balance owing to us at end (*1)

(*1 this is a debit balance but it is initially carried down from the credit side when the account is balanced off)

Creditor accounts

Cash/Cheques paid	Balance owing by us at start
Returns outwards	Credit purchases made during period
Discounts received	-
Balance owing to by at end (*2)	-

(*2 this is a credit balance but it is initially carried down from the debit side when the account is balanced off)