John has opening balances on his trade receivables of £68,000 and an allowance for receivables of £3,400. During the year John made cash sales of £146,000 and credit sales of £354,000. He collected cash from his credit customers of £340,000. At the end of the year John identified £2,000 of bad debts to write off. In addition, he estimated the need to increase the allowance for receivables to £4,000. A. Calculate the net trade receivables balance to present in the Statement of financial position at the year end B. What is the total bad and doubtful expense to be charged to the Statement of Profit or loss for the year?
John has opening balances on his trade receivables of £68,000 and an allowance for receivables of £3,400. During the year John made cash sales of £146,000 and credit sales of £354,000. He collected cash from his credit customers of £340,000. At the end of the year John identified £2,000 of bad debts to write off. In addition, he estimated the need to increase the allowance for receivables to £4,000. A. Calculate the net trade receivables balance to present in the Statement of financial position at the year end B. What is the total bad and doubtful expense to be charged to the Statement of Profit or loss for the year?
Chapter3: Income Sources
Section: Chapter Questions
Problem 79P
Related questions
Question
John has opening
receivables of £3,400. During the year John made cash sales of £146,000 and credit sales of
£354,000. He collected cash from his credit customers of £340,000.
At the end of the year John identified £2,000 of
the need to increase the allowance for receivables to £4,000.
A. Calculate the net trade receivables balance to present in the
at the year end
B. What is the total bad and doubtful expense to be charged to the Statement of Profit or loss
for the year?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
College Accounting, Chapters 1-27
Accounting
ISBN:
9781337794756
Author:
HEINTZ, James A.
Publisher:
Cengage Learning,
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
College Accounting, Chapters 1-27
Accounting
ISBN:
9781337794756
Author:
HEINTZ, James A.
Publisher:
Cengage Learning,
Individual Income Taxes
Accounting
ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT