ACCA F3 IRRECOVERABLE EXPENSE
On 31 March 2014, the balance on the receivables control account of P Company is $450,000. The
bookkeeper has identified that the following adjustments for receivables are required:
Irrecoverable debt recovered $9,000
Specific allowance $8,000
It was decided that a further allowance for receivables of 4% should be made based on past events. The
allowance for receivables on 1 April 2013 was $10,000.
What was the receivables expense for the year ended 31 March 2014?
| $ | $ | |
| Trade receivables | 450,000 | |
| Less Write Off | 8,000 | 8,000 |
| 442,000 | ||
| 4% New Allowance | 17,680 | 17,680 |
| Year End Receivables in Financial Position | 424,320 | |
| Less opening balance allowance for receivables | (10,000) | |
| Less Irrecoverable debt recovered | (9,000) | |
| Irrecoverable expenses in Income statement | 6,680 |
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