Question

Question 30.
From the following information supplied by X, who keeps his books on Single Entry System, you are required to calculate Total Purchases:
Opening balance of Bills Payable – ₹ 5,000
Opening balance of Creditors – ₹ 6,000
Closing balance of Bills Payable – ₹ 7,000
Closing balance of Creditors – ₹ 4,000
Cash paid to Creditors during the year – ₹ 30,200
Bills Payable discharged during the year – ₹ 8,900
Returns Outward – ₹ 1,200
Cash Purchases – ₹ 25,800

Answer 1

Answer:

input - output 25800p - 1200 we get,

24600

Answer 2

The total purchases made during the year amounts to Rs 40,300

Explanation:

Purchases is the temporary account, that is used in the inventory system in order to record the purchases of the merchandise for the purpose of resale. This account of purchases reports the purchase of the goods.

The creditors account will be created as:

Creditors Account

DR side

Cash A/c                                                               Rs 30,200

Purchase return A/c                                            Rs1,200

Bills payable A/c                                                  Rs 10,900

Balance c/d                                                           Rs 4,000

Total                                                                       Rs 46,300

CR side

Balance b/d                                                          Rs 6,000

Purchases A/c                                                      Rs 40,300

Total                                                                       Rs 46,300