Debt collection: Debt collection is an important aspect in any business. general ledger control account where all the entries passed in the debtors ledger control account will be contrived in the general ledger control account. dforce. Question 12 1. 5. In this case, debit the bad debt expense account for $2,350. The control account keeps the general ledger free of details, but still has the correct balance for preparing the company's financial statements. In the percentage of the outstanding debtor, a certain percentage of debtors is recorded as bad debt expense based on their aging or in simple word based on how old debtors are.For example, the company will record 1% as bad debts from debtors, which are not older than 30 days and 2.5% from debtors, which are not older than 60 days. Gum Ltd maintains subsidiary ledgers for debtors and creditors. Donnie's records $4,500 in the cash receipts journal (under both the "bank" and "debtors" column). 5. Definition: A control account, often called a controlling account, is a general ledger account that summarizes and combines all of the subsidiary accounts for a specific type. Discount is received from creditors. An asset makes a profit, either on a periodic basis, or when you sell the asset. The details for each control account will be found in a related (but separate) subsidiary ledger. In other words, it’s a summary account that equals the sum of the subsidiary account and … This is Debtor's … According to the market trend the business A bad debt can be written off using either the direct write off method or the provision method.The first approach tends to delay recognition of the bad debt expense.It is necessary to write off a bad debt when the related customer invoice is considered to be uncollectible. From debtor prospective: Increase (debit) asset accounts (e.g. The debit transaction increases the balance in the account to represent the additional account deemed uncollectible. Creditors are a result of credit purchases by the business. Total amount to be received (total debtors) is also known as Sales Ledger Control. Debtors are a result of credit sales by the business. when goods are sold on credit, sometimes the debtor is not satisfied with part or all of the goods . 3. What is the purpose of control accounts? A sum of money paid regularly to a person to meet the needs or expenses of the debtor. Cash, Land, Equipment, Unamortized Bond Issue Costs), increase (credit) liability accounts (e.g. 1 points. The bad debt expense account is an income statement account that reflects the loss that the business recognizes on uncollectible accounts. Transactions for year ended 30 June 2009 were as follows: What was the balance of the Debtors control account at 30 June 2009? Discount is allowed to debtors. Definition of Control Account. Businesses that want to keep good customer relations will provide a facility for goods to be returned. 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