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The balance in a company’s sales ledger total $76400. Of these, one customer has disappeared without trace owing $ 2300 and another, who owes $3600, is in liquidation. The liquidator has advised that creditors are likely to receive only 40 pence in the pound. The company wishes to make a general provision of 3% on all debtors balances not specifically provided for.
The Statement of Financial Position figure for debtors (net of provision) will be :
A 68385
B 69717
C 69782 <–
D 69825I’d be very grateful if you would provide me the solution to this question
Thank You.I am sorry but this forum is not for simply asking for solutions to questions.
You must have an answer in the same book in which you found the question (if not then you should be using a book from one of the ACCA approved publishers) and ask which part of the answer that you are not clear about.
Have you watched my free lectures on irrecoverable and doubtful debts? The lectures are a complete course for Paper F3 and cover everything needed to be able to pass the exam well.
Dear John Moffat,
I am confused with the phrase “40 pence in the pound”. Does it mean the company may receive 40% of $3600, right ?Sir can you tell me that how to treat allowance for doubtful debts and bad debts in cash flow statement
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