ACCA F3 IRRECOVERABLE EXPENSE 4
At 31 December 2014, a company's trade receivables totalled $350,000 and the allowance for receivables was $10,000.
It was decided that debts totalling $3,000 were to be written off, and the allowance for receivables adjusted to 4% 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 | 3,000 | 3,000 |
| 347,000 | ||
| 4% New Allowance | 13,880 | 13,880 |
| Year End Receivables in Financial Position | 333,120 | |
| Less opening balance allowance for receivables | (10,000) | |
| Irrecoverable expenses in Income statement | 6,880 |
To do the same topic again in ACCA F3 Irrecoverable Expense 4