D. Noakes makes an allowance for doubtful debts of 4% of accounts receivable, also a provision of 1% for discount on accounts receivable.

On 1 January 2018 the balances brought forward on the relevant accounts were allowance for doubtful debts 2,166 and provision for discounts on accounts receivable 526.

(a) Enter the balances in the appropriate accounts, using a separate Allowance for Doubtful Debts Account.

During 2018 Noakes incurred bad debts of 16,349 and allowed discounts of 3,857. On 31 December 2018 accounts receivable amounted to 67,500.

(b) Show the entries in the appropriate accounts for the year 2018, assuming that the business's accounting year ends on 31 December 2018, also Income Statement extracts at 31 December 2018.