ACCA F3 IRRECOVERABLE EXPENSE
On 31 March 2014, the balance on the receivables control account of P Company is $250,000. The
bookkeeper has identified that the following adjustments for receivables are required:
Irrecoverable debt recovered $7,000
Specific allowance $1,000
It was decided that a further allowance for receivables of 7% should be made based on past events. The
allowance for receivables on 1 April 2013 was $15,000.
What was the receivables expense for the year ended 31 March 2014?
| $ | $ | |
| Trade receivables | 250,000 | |
| Less Write Off | 1,000 | 1,000 |
| 249,000 | ||
| 7% New Allowance | 17,430 | 17,430 |
| Year End Receivables in Financial Position | 231,570 | |
| Less opening balance allowance for receivables | (15,000) | |
| Less Irrecoverable debt recovered | (7,000) | |
| Irrecoverable expenses in Income statement | -3,570 |
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