IGCSE Accounting: Control accounts (Cambridge 0452) – Revision Notes

Syllabus edition note. This resource follows the Cambridge IGCSE Accounting 0452 syllabus (and Cambridge O Level Accounting 7707, which has the same subject content for the same series) for exams in 2027, 2028 and 2029 (version 1), first examined in the March 2027 series in India and the June 2027 series elsewhere. If you sit 0452 in November 2026, you sit the 2026 syllabus (version 2), which differs: Paper 1 has 35 multiple-choice marks in 1 hour 15 minutes, not 40 marks in 1 hour 30 minutes; Topic 7 is “Accounting principles and policies”, without 7.2 Ethical considerations or 7.3 Technology and sustainability; 4.4 is “Irrecoverable debts and provision for doubtful debts”; income statements are named instead of statements of profit or loss; three-column running balance accounts are not required; Clubs and societies is 5.4 and Manufacturing accounts 5.5; and 6.3 is “Inter-firm comparison”. For this topic, the 2026 syllabus also lists dividends among the cash book updates, and it does not include the impact of digital transactions on bank reconciliation or on control accounts. If you sit in November 2026, work from the 2026 syllabus on the Cambridge International website.

Amounts are in dollars. These revision notes condense section 3.4 Control accounts of the Cambridge IGCSE Accounting 0452 syllabus for exams in 2027, 2028 and 2029. For full explanations and longer worked examples, read the study guide. Then test yourself with the practice questions. Links for the whole subject: course hub, printable checklist, free diagnostics and the wider topic page, Verification of accounting records.

The four things section 3.4 tests

1. The purposes of purchases ledger and sales ledger control accounts.
2. The books of prime entry as sources of the entries.
3. Preparing both accounts, with every listed item and with debit and credit balances within each account.
4. The impact of digital recording on preparing and using control accounts.

Not required: reconciling control account balances with the sales ledger and purchases ledger balances (the syllabus says so).

Definitions

Term	Meaning
Sales ledger control account	One ledger account that totals all customer accounts. Normal balance: debit.
Purchases ledger control account	One ledger account that totals all supplier accounts. Normal balance: credit.
Trade receivables	Amounts owed to the business by customers for goods sold on credit.
Trade payables	Amounts owed by the business to suppliers for goods bought on credit.
Cash discount	Reduction for early payment; recorded in the cash book discount columns.
Trade discount	Reduction on the invoice; never entered in a control account.
Contra entry	Setting off what a person owes you against what you owe them, when they are both customer and supplier. No cash moves.

Purposes: learn four

• Gives total trade receivables or trade payables at any date.
• Provides a check, because the total is built from the books of prime entry and so is independent of the individual accounts.
• Helps control, as the control account can be kept by someone other than the person posting to individual accounts.
• Finds a missing total when the other figures are known.

Sources

Entry	Book of prime entry
Credit sales	Sales journal
Credit purchases	Purchases journal
Sales returns	Sales returns journal
Purchases returns	Purchases returns journal
Receipts, payments, refunds, dishonoured cheques	Cash book (bank column)
Cash discounts allowed and received	Cash book (discount columns)
Irrecoverable debts, interest on overdue accounts, contra	General journal

Which side? Sales ledger control account

Debit side	Credit side
Opening debit balances	Opening credit balances
Credit sales	Receipts from customers
Dishonoured cheques	Cash discounts allowed
Interest on overdue accounts	Sales returns
Refunds paid to customers	Irrecoverable debts
Closing credit balances c/d	Contra (to purchases ledger)
	Closing debit balances c/d

Which side? Purchases ledger control account

Debit side	Credit side
Opening debit balances	Opening credit balances
Payments to suppliers	Credit purchases
Cash discounts received	Interest charged by suppliers
Purchases returns	Refunds received from suppliers
Contra (from sales ledger)	Dishonoured cheques (our cheques)
Closing credit balances c/d	Closing debit balances c/d

Memory aid: in the sales ledger control account, anything that makes customers owe more goes on the debit side. In the purchases ledger control account, anything that makes you owe suppliers more goes on the credit side. Everything that reduces the debt goes on the other side.

Method in steps

1. Read the question and mark each item as sales ledger or purchases ledger.
2. Draw a two-sided account with an amount column on each side.
3. Place opening debit balances and opening credit balances on their own sides.
4. Enter each total from the books of prime entry on the correct side. Ignore trade discount and cash sales.
5. Put a given closing balance of the unusual kind (credit balances in the sales ledger, debit balances in the purchases ledger) on the side with the other opening items.
6. Total the side with more information. Find the balancing figure on the other side. Check that both totals agree.
7. Label every line (source or description) and bring down the balances.

Small worked reminder

Norcott Bakery Supplies: opening debit balances 5,000; credit sales 12,000; receipts 9,500; cash discounts allowed 200; sales returns 400. No other items.

Sales ledger control account
Debit	Amount	Credit	Amount
Balance b/d	5,000	Bank	9,500
Credit sales	12,000	Discount allowed	200
		Sales returns	400
		Balance c/d	6,900
	17,000		17,000

Debit side 5,000 + 12,000 = 17,000. Credit side known: 9,500 + 200 + 400 = 10,100. Balancing figure: 17,000 - 10,100 = 6,900.

Must-know distinctions

• Cash discount and trade discount. Only cash discount is entered in a control account.
• Credit sales and cash sales. Only credit sales go into the sales ledger control account; the same applies to purchases.
• Dishonoured cheque from a customer and one issued by you. The first is a debit in the sales ledger control account. The second is a credit in the purchases ledger control account.
• Interest charged to a customer and interest charged by a supplier. The first increases what customers owe: debit, sales ledger. The second increases what you owe: credit, purchases ledger.
• Refund paid to a customer and refund received from a supplier. The first clears a customer’s credit balance: debit, sales ledger. The second clears a supplier’s debit balance: credit, purchases ledger.
• Contra and payment. A contra uses no cash and no bank account. It appears in both control accounts on opposite sides.

Digital recording

• Software can total the journals and produce a control account automatically and at any date.
• Arithmetic errors in totals are less likely, so the account is quicker to prepare and can be used more often, for example for chasing overdue accounts.
• An input error (wrong amount or wrong customer) is still carried through.
• Access controls, passwords and backups protect the data the totals depend on.

Quick self-test

1. On which side of the sales ledger control account does a customer’s dishonoured cheque go?
2. Name the book of prime entry for total credit purchases.
3. A supplier charges the business 80 interest on an overdue account. Which control account, and which side?
4. What entries record a contra between the two control accounts?
5. A business pays back 120 to a customer whose account was in credit. Which account, and which side?
6. Opening debit balances 8,200; credit sales 15,000; receipts 13,100; discount allowed 300; returns 500. Find the closing debit balances.
7. Does trade discount appear in a control account?
8. Opening credit balances 6,400; credit purchases 11,800; payments 10,200; discount received 250; returns 600. Find the closing credit balances.
9. What does a debit balance on a supplier’s account normally mean?
10. State one advantage and one limitation of producing control accounts from digital records.
11. Must you reconcile a control account balance with the ledger balances?

Answers

1. Debit side.
2. Purchases journal.
3. Purchases ledger control account, credit side.
4. Debit purchases ledger control, credit sales ledger control, for the amount set off.
5. Sales ledger control account, debit side.
6. 9,300 (8,200 + 15,000 - 13,100 - 300 - 500).
7. No. Only the net invoice value goes through the journals.
8. 7,150 (6,400 + 11,800 - 10,200 - 250 - 600).
9. The supplier owes the business, for example after an overpayment.
10. Advantage: totals available quickly and at any date. Limitation: wrong data entered is still carried through.
11. No. The syllabus says you do not need to.

Where marks are usually lost

• Putting a dishonoured customer cheque on the credit side.
• Using cash sales, or trade discount, as if they belonged in the account.
• Entering the contra in only one control account, or on the same side in both.
• Leaving out the opening credit balances (sales ledger) or opening debit balances (purchases ledger).
• Putting a closing credit balance (sales ledger) on the credit side, where it makes the totals disagree.
• Making a balancing error because an item was missed, so the totals do not agree.
• Unlabelled lines. Marks are usually for the item as well as the amount, so give each line a description.
• Describing digital records as removing all errors. Say that input errors remain.
• Writing “trade payables” for the sales ledger control account balance, or the reverse.

Frequently asked questions

What are the purposes of control accounts? Control accounts give total trade receivables or payables at any date, act as an independent check on ledger postings, help control error and fraud when different people keep them, and supply figures for the statement of financial position.

Where do the figures in a control account come from? They come from totals of the books of prime entry, such as the sales and purchases journals, the returns journals, the cash book and the general journal, not from the individual customer or supplier accounts.

How are closing credit balances in the sales ledger shown? Customers with credit balances, for example after an overpayment, are carried down on the debit side of the sales ledger control account so that they are brought down as a credit. Putting them on the credit side makes the totals disagree.

Are cash sales included in the sales ledger control account? No. Only credit transactions belong in the sales ledger control account, so cash sales from the cash book are left out.

Official syllabus

Cambridge IGCSE Accounting 0452 syllabus for exams in 2027, 2028 and 2029 (version 1), published by Cambridge University Press & Assessment (Cambridge International Education): section 3.4 Control accounts.