4. Incomplete Records Accounting

Question 1

When working out sales and purchases figures …

Answer 1

Need 4 bits info:
Opening balance
Closing balance
Bank and cash payments (purchases) or receipts (sales) for year
Purchases or sales for year

If have 3 can use control account method to work out the 4th.

• Don’t forget returns and discounts.
• Don’t forget irrecoverable debts.
• ** watch out for red herring Doubtful Debts !!!!!

Question 2

If working out missing stock (owner or stolen)

Answer 2

Use the OI + P - CI = COS calc.

Rejig it to calculate what closing stock should be … then compare to amount given in question.

Question 3

COS & COGS are the same ?

Answer 3

Yes
It’s a t account:
Debit OI
Debit Ps
Credit P Ret’ns
Credit CI

Balance should be a debit on the P&L and replaces the accounts above.
You still need a closing inventory fig on the TB… as a debit to go to SFP.