Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

please reply ASAP! Question 11 The closing trade receivables as at 31/12/2020 before bad debts written off were 64,000. The business has increased its allowance

please reply ASAP! image text in transcribed
Question 11 The closing trade receivables as at 31/12/2020 before bad debts written off were 64,000. The business has increased its allowance on trade receivables from 2% during 2019 to 4% during 2020 on closing trade receivables after bad debts written off, to reflect the worsening economic environment. No bad debts were incurred and recorded during 2019. The following two transactions have just been recorded in preparation for finalising the financial statements for the year ending 31/12/2020: No ASSETS EXPENSES LIABILITIES REVENUES (Op) EQUITY +8,000 (bad debts written off) -8.000 (trade receivables) - 1,000 (allowance for trade receivables Allowance) +1,000 (doubtful debts) Calculate the following: (a) What was the allowance for trade receivables balance shown on the Statement of Financial Position as at 31/12/2020? (2 marks) (b) What was the closing net trade receivable balance le after the allowance for trade receivables) shown on the business's Statement of Financial Position as at 31/12/2019? (4 marks)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Accounting questions

Question

What are the assumptions of break-even analysis?

Answered: 1 week ago