Question on: JAMB Accounting - 2023

Given:
I. Cash refunds
II. Debit note issued
III. Dishnoured cheque
IV. Purchases

The item on the credit side of purchase ledger control account includes

I, II and IV only

I and IV only

I and II only

I, II and III only

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Correct Option: C

In a purchase ledger control account, the items on the credit side include:

I. Cash refunds: When a supplier refunds cash for any reason, it decreases the accounts payable balance, so it appears on the credit side.

II. Debit note issued: If a debit note is issued by the supplier, it usually signifies a reduction in the amount payable, and it appears on the credit side.

III. Dishonored cheque: A dishonoured cheque doesn't directly impact the purchase ledger control account. It's typically associated with the bank or cash account, not the accounts payable.

IV. Purchases: Purchases are typically recorded on the debit side of the purchase ledger control account because they represent an increase in accounts payable.

So, the items on the credit side of the purchase ledger control account are I and II.