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I have struggle with question 55 in Kaplan kit. Hope you support!
Receivable at year end: 74,963 (20X7) 69,472 (20X8)
Sales: 697,104 (20X7)
Total cash received from customer: 686,912 (20X7)
Specific allowance for receivable: 2,014 (20X7) 1,578 (20X8)
Irrecoverable debt written off: 1,697 (20X7)What was the value of sale returns during 20X7?
-> sale returns= 69,472 + 697,104 – 686,912 -1,697 – 436 = 2,568 (My calculation)
-> sale returns= 69,472 + 697,104 – 686,912 -1,697 = 3,004 (Kaplan’s Answer)Following the answer, Why the movement of “Specific allowance for receivable” is not effect on the Receivables T-ledger account in this question?
Dr. P/L
Cr. Allowance for receivable 436 (2014-1578)The allowance for receivables is a separate account and does not affect the receivables account.
Have you watched my free lectures on irrecoverable and doubtful debts? The lectures are a complete free course for Paper FA and cover everything needed to be able to pass the exam well.
Thanks you, Tutor! I already watched your lectures on irrecoverable and doubtful debts, that’s great. I comprehend that issue.
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