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Dear sir,
I have been facing a lot of problem when the question asks me if the figure should be debited or credited in SOFP and SOPL. I can get the figures easily but i am confused if it should be in SOFP or SOPL and whether they should be debited or credited.
I tried studying in BPP text and I cant seem to understand. I was wondering if you have any lectures on this and may I know which chapter, please?
(this makes me feel so demotivated because I feel like as if I only understand the mathematical part and not the accounting part)
Also sir, I have been practicing irrecoverable debts and I am confused when it is reduction in allowance and increase in allowance.
is it correct if I say existing allowance < new allowance = reduction in allowance and vice versa?
thank you so much
Firstly we do not actually debit or credit anything in the SOFP – it is simply a list of the balances remaining on the accounts.
All of this is explained in my lectures, but you really need to watch them in order because they build on each other (it is obviously impossible to cover everything in one lecture 🙂 )
The lectures are a complete free course for Paper FA and cover everything needed to be able to pass the exam well.
With regard to irrecoverable and doubtful debts, if the new allowance is more than the existing allowance then we have an increase in the allowance (and vice versa).
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