Individual debtor accounts(debtors ledger) Question 1: .Balance on 1st August 2018 - R24 348.73 (Note: no interest is included in this balance) Day 14: Received a cheque from Mr Sulliman in full settlement of the amount owing, less 7½% settlement discount. Receipt no.RC423 and journal voucher JV11 were issued. Explain and show me how we got the answer R26 093.08 recorded on the credit column on the debtors ledger of Hawkes Enteprises.

Here's how the amount of R26,093.08 is recorded on the credit column of Mr. Sulliman's debtors ledger: Step 1: Identify the gross amount of the debt. The amount of R26,093.08 represents the gross amount of the debt that Mr. Sulliman owed to Hawkes Enterprises before any settlement discount was applied. This is the full original value of the invoice or amount due. Step 2: Explain the accounting treatment for a settlement. When a debtor settles an amount, their individual account in the debtors ledger is credited with the full gross value of the debt being settled. This entry reduces the debtor's outstanding balance by the original amount owed, effectively clearing that specific debt from their account. Step 3: Calculate the settlement discount and cash received. The 7.5% settlement discount is calculated on this gross amount. Settlement Discount = Gross Amount × Discount Rate Settlement Discount = R26,093.08 × 0.075 = R1,956.98 The actual cheque received from Mr. Sulliman would be the gross amount less this discount: Cash Received = Gross Amount - Settlement Discount Cash Received = R26,093.08 - R1,956.98 = R24,136.10 Therefore, the R26,093.08 is recorded as a credit in the debtors ledger to clear the gross debt, while the R24,136.10 cash received and the R1,956.98 settlement discount allowed are recorded in other relevant accounts. The final answer is R26,093.08 is the gross amount of the debt credited to the debtors ledger to clear the outstanding balance.. Send me the next one 📸