everything

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
Hi all good luck to everyone on tuesday. we can all say we did it.

what is memoranda account, why do they keep giving things different names. Is it to confuse us if so it just worked and thats from an old test paper. :?


Thank you all for the help you gave with my portfolio :D

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:everything

    As far I hear the term used its an account thats not in the nominal/general ledger. i.e. individual sales and purchase ledger accounts for the customers and suppliers.

    I suppose the term memoranda is used because it aids in reconciliation and gives a detailed explanation of what the sales and purchase ledger control account in the nominal actually contain.

    Hope this helps
    Adrian

    P.S. I know what you mean about all the different terms it dosen't seem to get better at higher levels!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:everything

    I have been told that a memoranda account is for accounts where is doesnt form part of the double entry when posting from the cash book, for example discounts allowed. The column is there to REMIND you (hence memoranda) to post the discounts allowed. So when the question says that the cash book forms part of the double entry, the discounts allowed needs 3 entries, both Dr and Cr in the main ledger and post to the subisdary account.

    Does that make sense?
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:everything

    I agree

    Memoranda accounts are accounts which don't form part of the double entry ie. subsidiary purchase and sales ledger (individual accounts). They are just there to reconcile the control accounts.

    The discounts column in the cashbook is a memoranda column, but does form part of the double entry.

    Good luck to everyone on tuesday

    Gem
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:everything

    They are also known as memorandum accounts. They are not part of the double entry as said. They are also called the subsidiary ledgers.

    basically they are the individual accounts of the debtors and creditors. Any postings that you do to the purchase ledger control or the sales ledger control accounts are then broken down for the company reference into the individual memorandum/subsidiary accounts (therefore posted the same side as they would be in the PLCA/SLCA).

    As Gem said, the discount allowed is NOT a subsidary/memorandum ledger. It is ONLY the individual debtor/creditor accounts as far as my lecturer has advised me!!

    Tara :)
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:everything
    Gem7321 wrote:
    The discounts column in the cashbook is a memoranda column, but does form part of the double entry.
    Gem

    Not sure I'm with you on this Gem. Surely the discount allowed column in the cash book does not form part of the double entry system. The double entries for discount allowed are in the Discount Allowed a/c and the SLCA. That's why it's a memorandum column unlike the other cash book columns which are part of the double entry system.

    Chris
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:everything

    i emailed my tutor and she sent me the following:
    a memorandum account is another name fo rthe accounts in the sales or purchase ledgers. They are called memorandum accounts because they are used to record the amounts owed to or by the company and ARE NOT part of the double entry system of the main ledger. Thought i would share this with all.

    GOOD LUCK EVERYONE FOR TOMORROW!!!!!!!!!!!!!!!! :P :wink: :thumbup:

    Troodie

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