purchases account and sales account

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion


Just to Clarify

Is the purchases account, the same thing as a debtors account

And sales acount the same as creditor account?

Sorry if i've got it round the wrong way!

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:purchases account and sales account

    the purchases represents the amount you have spent during the period on stock (for example) that is to be resold.

    the creditors figure is total amount of money you owe to suppliers at that time.

    the debtors figure is the total amount owed to you from customers.

    the sales figure represent the amount you have sold during the period.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:purchases account and sales account

    Purchases account = the total amount of goods you have bought. (Left side of "T" account)

    Sales account = the total amount of goods you have sold. (Right side of "T" account)

    Debtors account (Sales ledger control account) = total amount of goods you have sold minus any returns and bankings (discounts too if they are offered). (Total sales left side of "T" account, payments and returns on right side of "T" account)

    Creditors account (Purchase ledger control account) = total amount of good you have bought minus payments, returns & discounts. (Total purchases right side of "T" account, payments, discounts & returns left side of "T" account)

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