ACCA F3 IRRECOVERABLE EXPENSE 4
At 31 December 2014, a company's trade receivables totalled $450,000 and the allowance for receivables was $35,000.
It was decided that debts totalling $2,000 were to be written off, and the allowance for receivables adjusted to 8% 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 | 450,000 | |
| Less Write Off | 2,000 | 2,000 |
| 448,000 | ||
| 8% New Allowance | 35,840 | 35,840 |
| Year End Receivables in Financial Position | 412,160 | |
| Less opening balance allowance for receivables | (35,000) | |
| Irrecoverable expenses in Income statement | 2,840 |
To do the same topic again in ACCA F3 Irrecoverable Expense 4