ACCA F3 IRRECOVERABLE EXPENSE 4
At 31 December 2014, a company's trade receivables totalled $350,000 and the allowance for receivables was $5,000.
It was decided that debts totalling $1,000 were to be written off, and the allowance for receivables adjusted to 2% of the receivables.
What figures should appear in the statement of financial position for trade receivables (after deducting the allowance) and in the statement of profit or loss for receivables expense?
| $ | $ | |
| Trade receivables | 350,000 | |
| Less Write Off | 1,000 | 1,000 |
| 349,000 | ||
| 2% New Allowance | 6,980 | 6,980 |
| Year End Receivables in Financial Position | 342,020 | |
| Less opening balance allowance for receivables | (5,000) | |
| Irrecoverable expenses in Income statement | 2,980 |
To do the same topic again in ACCA F3 Irrecoverable Expense 4