The following information was extracted from the books of Khan Trading for the month of October 2025. Item $ Trade receivables at 1 October 12 400 Credit sa...

(a) Sales Ledger Control Account - October 2025

The sales ledger control account (SLCA) is a summary account in the general ledger that provides the total balance of all individual debtor accounts. Items that increase what customers owe are debited; items that reduce what they owe are credited.

Closing balance calculation: $12 400 + $48 600 - $45 200 - $1 350 - $2 100 - $530 = $11 820 [1]

(b) Three purposes of a control account

1. To provide a check on the accuracy of the postings to the individual accounts in the sales ledger. If the control account balance agrees with the total of individual balances, the double entry is likely correct. [2]
2. To help locate errors quickly when the trial balance does not agree, since the control account narrows the search to either the individual ledger accounts or the books of prime entry. [2]
3. To provide a total figure for trade receivables for the statement of financial position without needing to add up all individual debtor balances, speeding up the preparation of financial statements. [2]

(c) Difference between the sales ledger and the SLCA

The sales ledger contains individual accounts for each credit customer, showing the detailed transactions (sales, returns, receipts, discounts) for each debtor. [1]

The sales ledger control account is a single summary account in the general ledger that shows the total of all debtor balances combined. It is prepared from the totals of the books of prime entry, not from the individual accounts. [1]

(d) Where the closing balance appears

The closing debit balance of $11 820 would appear as a current asset in the statement of financial position, [1] classified as trade receivables. [1]