At 30 June 20X6 a business had a provision for doubtful debts of £37600. At 30 June 20X7 it was decided to write-off £21900 as bad debts and that a specific provision for doubtful debts of £45300 was required. What is the total expense for bad and doubtful debts which will appear in the business's income statement for the year ended 30 June 20X7?
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
At 30 June 20X6 a business had a provision for doubtful debts of £37600. At 30 June 20X7 it was decided to write-off £21900 as
What is the total expense for bad and doubtful debts which will appear in the business's income statement for the year ended 30 June 20X7?
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