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Question No 3: (15 Marks) Mr Sultan is in the business of construction. He is presently having many projects on hand and is very busy

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Question No 3: (15 Marks) Mr Sultan is in the business of construction. He is presently having many projects on hand and is very busy on completing the project before the deadline. The major item in the business is the cash cycle and this is dependent on the collection from the Accounts receivables. Mr Sultan appoints you on 1st March 2019 to manage his business Accounts receivable and to regularly follow up with the accounts receivables for collection of cash as and when due. You have collected the accounts details from the accounts person relating to receivables. The Accounting record shows projects completed in February was of RO 395,500 and the Accounts receivable was RO 247,680. During the month of March, you have collected the details of the Accounts receivables. Your finding about the accounts receivable reveals that in one of the project completed six month back, an amount of RO 2250 was retained by the customer as deposit for guarantee for the construction completed. However Due to very heavy rains the site was damaged, and the deposit got forfeited. During the current month business completed project for RO 377,250 and the amount collected from receivables were RO 393,800. During the Month of April, the business completed contract for RO 390,700 and the collection from Accounts receivable were RO 418,000. One of your receivables on whom RO 10500 was due on 10th April could not pay the amount and accepted 30 days note at 10% interest. This was not recorded in the accounts. The Write off Method for recording uncollectable was not feasible for this type of business and so, you have decided to change from direct writ off method to the allowance method for recording uncollectable for doubtful debts. You have decided to make an allowance @5% on closing Accounts receivable. In the month of May on the due date, the note receivable was dishonoured. You are required to write the required Journal entries to record the above transactions. **note: Working notes form part of the

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