A A business, which started trading on 1 January 2010, adjusted its allowance for doubtful debt at the end of each year on a percentage basis, but each year the percentage rate is adjusted in accordance with the current ‘economic climate’. The following details are available for the three years ended 31 December 2010, 2011 and 2012.

You are required to show:

(a) Bad Debts Accounts for each of the three years.

(b) Allowance for Doubtful Debts Accounts for each of the three years.

(c) Statement of Financial Position extracts as at 31 December 2010, 2011 and 2012.

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2010 2011 2012 Bad debts written off year to 31 December 1,240 2,608 5,424 Accounts receivable at 31 December after bad debts written-off 41,000 76,000 88,000 Percentage allowance for doubtful debts 465