L. Baadjies had these receivables on her books on 1 December 20x8: (Ignore VAT.)

The allowance for bad debts account on 1 January 20x8 = R900.

Transactions for December:

3 J. Crause could not be traced. His account must be written off as bad.

7 A. Herbst was declared insolvent. A payment of 20c in the R1 from his liquidated estate has been received.

11 N. Radebe has communicated that he cannot meet his obligations. His account must be written off as a bad debt.

14 V. Chetty, a receivable previously written off, was traced and settled his account of R360.

31 Accounts receivable accounts settled during the month, R7 300.

Credit sales for the month R8 600.

You are required to:

1. General journal entries for the transactions.

2. Adjust the allowance for bad debts to 5% of outstanding accounts receivables. Show all the closing entries in the general journal.

Transcribed Image Text:

J. Crause A. Herbst N. Radebe Other receivables R500 R700 R260 R14 800