(a)[2]
Explain why it may be important for a business to keep a provision for doubtful debts.
(b)[2]
Prepare a journal entry showing the write-off of the irrecoverable debts. A narrative is not needed.
(c)[2]
State two ways in which the risk of irrecoverable debts may be reduced.
(d)[4]
Calculate the adjustment needed to the provision for doubtful debts at 31 December 2020.
(e)[3]
Prepare the provision for doubtful debts account for the year ended 31 December 2020.
(f)[2]
State two factors that should be considered when deciding on a provision for doubtful debts.