The following information has been extracted from the books of Smith Ltd for the month of February 2015.

Required

Prepare a sales ledger control account and a purchases ledger control account at 28 February 2015.

You are asked to prepare both a sales ledger control account and a purchases ledger control account in this question.

Step 1: Decide which entries should be part of the sales ledger control account and which entries should be part of the purchases ledger control account.

Step 2: Decide if there are any entries that should not appear in either control account.

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Purchases ledger balances (credit) at 1 February 2015 56 407 Sales ledger balances (debit) at 1 February 2015 83 359 Irrecoverable debt written off customer acccunt 185 Cheques paid to credit suppliers 52 131 Cheques received from credit customers 85 460 Contra (debit baance in sales ledger set off against purchases ledger) 249 Customer cheque dishonoured 1 036 Discounts allowed 1 360 Discounts received 858 Cheque paid to a supplier cancelled 264 Total cash purchases for February 2015 880 Total cash sales for February 2015 2 367 Total of purchases journal for February 2015 62 042 1 553 Total of purchases retums joumal for February 2015 Total of sales journal for February 2015 99 842 Total of sales returns journal for February 2015 2 460