Question

Collin has extracted the following balances from the ledger accounts for his business: (All amounts in $) Plant and machinery 95,000; Property 135,000; Inventory 6,400; Payables 3,600; Receivables 2,850; Bank overdraft 970; Loan 45,000; Capital 100,000; Drawings 32,000; Sales 362,000; Purchases 156,000; Purchase returns 2,200; Carriage outwards ?; Discounts received 3,500; Sundry expenses 82,500. He has forgotten to extract the balance from the carriage outwards account. What is the value of the missing balance? *

Answer 1

Without additional context or figures, such as closing stock or total expenses, it is impossible to calculate the missing carriage outwards figure from the provided balances. Collin should use the accounting equation and further details from his financial records to deduce the missing amount.

Step-by-step explanation:

To determine the value of the missing balance for carriage outwards, Collin needs to prepare a trial balance which involves totaling up all the debits and credits in the ledger accounts to see if they balance. However, the information provided does not directly reveal the missing carriage outwards figure. Instead, Collin should use the accounting equation (Assets = Liabilities + Equity) and his income statement to deduce the missing figure. Unfortunately, the data provided in the question does not give enough context or numbers to calculate the missing balance directly, as the necessary figures (such as opening stock, closing stock, or total expenses) to compute Collin's net income or loss – which could then be used to indirectly calculate the carriage outwards – are not mentioned.

Answer 2

Carriage outwards: 7,520 debit

Step-by-step explanation:

Accounts DEBIT CREDIT

Plant and machinery 95,000

Property 135,000

Inventory 6,400

Receivables 2,850

Payables 3,600

Bank overdraft 970

Loan 45,000

Capital 100,000

Drawings 32,000

Sales 362,000

Carriage outwards x

Purchases 156,000

Purchase returns 2,200

Discounts received 3,500

Sundry expenses 82,500

TOTAL 509,750 517,270‬

We construct the trial balance and the carriage outwar balance will be the diference between debit and credit:

517,270 - 509,750 = 7,520