MC is a trader who maintains a full set of accounting records and prepares control accounts at the end of each month. MC has provided the following information for the month of July 2022. On 1 July 2022 Purchases ledger control account credit balance b/d $ 21400 Purchases ledger control account debit balance b/d 130 Totals for the month Credit purchases 259600 Credit purchases returns 9800 Cash purchases 240 Cheques paid to credit suppliers 228200 Discount received 12900 Cash paid to credit suppliers 500 Interest charges by credit suppliers 150 Contra sales ledger 2260 At 31 July 2022 the purchases ledger control account had a credit balance c/d of $180.

1. (a)Complete the table to name the book of prime entry which MC would use to obtain information when preparing control accounts. Item Discount received from credit suppliers Purchases returns Contra entries Interest charged by credit suppliers[4]
2. (b)Explain how a contra entry is treated in the ledger accounts.[2]
3. (c)Prepare the purchases ledger control account for the month of July 2022. Balance the account and bring down the balances on 1 August 2022.[9]
4. (d)Advise MC whether he should change to the new overseas supplier. Justify your answer.[5]