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Question 1 L Hutton commenced business on 1st January 2009 and prepares accounts to 31st December each year. For year end 31st December 2009 Hutton has written off bad debts of 1,720 and has created an allowance (provision) for doubtful debts of 2,350. In 2010 debts of 1,930 prove to be uncollectable and were written off, however P May, whose debt of 330 was written off in 2009, pays in full on 30th June 2010. At 31st December 2010 total debtors were 105,000 and it was decided to make the allowance for doubtful debts 3% of outstanding debtors. In 2011 2,740 of debts were written off and a further recovery was made on a 185 debt written off in 2009. Outstanding debtors at 31 December 2011 were 86,000 and the allowance for doubtful debts was raised to 3.5% Required: For each of the years from 2009 to 2011, show: (a) Bad Debts and Bad Debts Recovery Accounts [5] (b) Allowance for Doubtful Debts Accounts [6] (c) Extracts from the Profit & Loss account [4]