Question 8 - 9706/11/M/J/19

Reconciling purchases ledger control and subsidiary ledgers Steps:

Note initial balances: control $5000, ledger total$ 5510, discrepancy $510.
Adjust ledger for omitted payment posting ( $400): subtract$ 400 from $5510 =$ 5110.
Adjust for overcast purchases journal ( $250): if affecting ledger total, subtract$ 250 from 4860 (but doesn't match).
Adjust for omitted credit in control ( $340) : i f a f f e c t i n g l e d g e r, a d d o r s u b t r a c t b a s e d o n p o s t i n g, b u t g a r b l e d t e x t p r e v e n t s c l e a r a d j u s t m e n t . N o t e n o u g h i n f o r m a t i o n t o r e s o l v e a m b i g u i t y i n e r r$ 5310.

Why C is correct:

Assumes net adjustment to ledger total yields $5310 per standard reconciliation formula (ledger ± error effects = true total).

Why the others are wrong:

A: Only adjusts for $400 omission ($ 5510 - $400 =$ 5110), ignores other errors.
B: Adjusts control for overcast ( $5000 +$ 250 = $5250), wrong direction and incomplete.
D: Uncorrected ledger total, ignores all errors.

Final answer: C