Use the following to answer the given question Creditors Control Account: \(\begin{array}{c|c} & & & N \\ \hline Bank & \text{"X"} & \text{Balanxe b/d} & 1,...
Question 1 Report
Use the following to answer the given question
Creditors Control Account:
\(\begin{array}{c|c} & & & N \\ \hline Bank & \text{"X"} & \text{Balanxe b/d} & 1,200 \\ Discount & 30 & \text{"Y"} & 1,800 \\ \text{Balance c/d} & 450 & & \\ \hline & & & & \hline \end{array}\)
The balance of 450 in the above accounts represents
Creditors Control Account:
\(\begin{array}{c|c} & & & N \\ \hline Bank & \text{"X"} & \text{Balanxe b/d} & 1,200 \\ Discount & 30 & \text{"Y"} & 1,800 \\ \text{Balance c/d} & 450 & & \\ \hline & & & & \hline \end{array}\)
The balance of 450 in the above accounts represents
Answer Details
The balance of 450 in the Creditors Control Account represents a current liability. The Creditors Control Account is a summary account that shows the total amount owed to all creditors. The balance of 450 on the credit side of the account represents the total amount owed to creditors at the end of the accounting period. This balance is carried forward to the next period as the balance brought down (b/d) on the debit side of the account. Therefore, the 450 represents the amount that the company owes to its creditors as a current liability.
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