Q$2.$ Estimates

Tommy Company sells electronics equipment and has grown rapidly in the last year by adding new

customers. The company provides a credit term of $30$ days for its customers, allowing them to make

payments within a period of $30$ days from the date of purchase.

The audit partner has asked you to evaluate the allowance for doubtful accounts as at $31$ December

Comparative information on sales and accounts receivable is:

Requirement

Perform substantive analytical procedures to evaluate whether the allowance is fairly stated at $31$

December $2023.$ Assume performance materiality for the allowance account is $$15,000.$