₦Debtors opening4000Debtors closing1500Cash received from debtors8500Bad debts written off350Discount allowed500Discount received1000 What is the…

Explanation

Step 1: Understand the Debtors Control Account formula
Opening Debtors + Credit Sales = Cash Received + Bad Debts + Discount Allowed + Closing Debtors
Rearranging: Credit Sales = Closing Debtors + Cash Received + Bad Debts + Discount Allowed – Opening Debtors

Step 2: List the given values
Opening Debtors = ₦4,000
Closing Debtors = ₦1,500
Cash Received = ₦8,500
Bad Debts Written Off = ₦350
Discount Allowed = ₦500
Discount Received = ₦1,000 (ignore – this is from creditors, not debtors)

Step 3: Calculate Credit Sales
Credit Sales = ₦1,500 + ₦8,500 + ₦350 + ₦500 – ₦4,000
= ₦10,850 – ₦4,000
= ₦6,850

Step 4: Verify with T-Account logic
We started with ₦4,000 owed to us. We must have sold ₦6,850 on credit. From this:
– ₦8,500 was paid in cash
– ₦350 became bad debts (uncollectable)
– ₦500 was given as discount
– ₦1,500 still owed
Total: ₦8,500 + ₦350 + ₦500 + ₦1,500 = ₦10,850 = ₦4,000 + ₦6,850 ✓

Remember: Discount received is from our suppliers (creditors), not from our customers (debtors). Only include items affecting the debtors account.