Rahim is a trader. His financial year ends on 30April. He maintains a provision for doubtful debts
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Question:
Rahim is a trader. His financial year ends on 30April. He maintains a provision for doubtful debts of 2 % of the trade receivables at the end of each year.
On 1 May 2015 Rahim provision for doubtful debts amounted to $474. On 30th April 2016 his credit customers owed $17,440.
REQUIRED:
2) Prepare an extract from the statement of financial position on 30April 2016 to show the Trade Receivables.
On 10th May 20 Rahim received a cheque, $49, from Mr Kim, whose account had been written off in 2014.
5) Prepare the ledger entries to record the above transaction.
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