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Sir, I have 2 doubts;
(1) why we are reducing the irrecoverable debt from cash received. it was already reduced from trade receivables’ closing balance, wasn’t it?
(2) why we are adding profit on non-current asset in other cash payment?Please sort out my doubt………
1. The irrecoverable debt did indeed reduce the closing balance on receivables. Prepare yourself a receivables t-account and after crediting with the irrecoverable debt, the ‘missing figure’ is the cash received.
2. The cash received was 24,000 but the 6,000 profit had been netted off against expenses
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