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Recv and Pay

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FA – FIA FFA › Recv and Pay

  • This topic has 3 replies, 2 voices, and was last updated 5 years ago by John Moffat.
Viewing 4 posts - 1 through 4 (of 4 total)
  • Author
    Posts
  • May 24, 2020 at 7:48 am #571715
    victorwilson
    Participant
    • Topics: 19
    • Replies: 27
    • ☆

    Dear Mr. John,

    At Jan 20*1 there was an allowances for receivable of $ 3000, During the year$ 1000 of debts were written as irrecoverable & $ 800 of debts previously written off were recovered.At 31 december 20*1 it was decided to adjust the allowances to 5% of receivable which are $ 20000/-

    As per the solution (15% of 20000) has been calculated and instead =(20000-1000)%15

    As per the question FIA-FFA Financial Accounting revision kit 2019

    Chapter Receivable & payable Q -11:11

    Need your advice
    Regards Victor

    May 24, 2020 at 12:13 pm #571740
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54699
    • ☆☆☆☆☆

    The reason is that the question says that the $1,000 was written off during the year, and therefore $20,000 at the end of the year is already after removing the $1,000.

    If the question said that it was decided at the end of the year to write of $1,000, then you would have subtracted $1,000 before calculating the allowance.

    May 26, 2020 at 9:07 pm #571895
    victorwilson
    Participant
    • Topics: 19
    • Replies: 27
    • ☆

    Mr. John ,

    The question says ..

    Adjust the allowances for receivable to 5% of receivable which are $20000/- but answer taken 15%

    Need advice
    Regards
    Victor

    May 27, 2020 at 8:37 am #571927
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54699
    • ☆☆☆☆☆

    Although the answer does say 15%, it is a typing error and if you check you will see that they have correctly calculated 5% of 20,000 which is 1,000.

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