Techniques to find missing information: control/total accounts, cash accounts, bank accounts, ratios (mark up, gross profit margin, inventory turnover, profit in relation to revenue), depreciation of non-current assets, calculation of profit or loss on disposal of non-current assets, use of financial statements to find missing figures
When a business has not kept full accounting records, accountants use specific techniques to reconstruct missing figures. These techniques include rebuilding accounts, applying ratios, and working backwards from known totals.
Formula
Credit Sales = Closing Receivables + Cash Received − Opening Receivables
Real World
An independent bookshop owner who lost their sales daybook in a flood can reconstruct total credit sales by using the opening and closing trade receivables figures from bank statements and supplier correspondence.
Exam Focus
Set out control accounts in T-account format and label the balancing figure clearly — examiners need to see your method, not just the answer.
Essay Framework
Use PEEL to structure every paragraph. Tap each step for guidance and an example.
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