The following table contains balances extracted from the trial balance at the years ended 31 December:

Calculate the effect on each year’s profit from the above data – you can assume that no provision for doubtful debtors existed prior to 2004.

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Bad debts Provision for doubtful debts Bad debts recovered 2004 500 400 300 2005 650 200 0 2006 475 300 100 2007 380 350 50