Accounting 9706 · AS & A Level · Reconciliation and verification

Reconciliation and verification — practice question

A company’s trial balance reported trade receivables of $14600 together with an opening provision for doubtful debts of $470. It was then found that the trade receivables contained an irrecoverable debt of $500. In addition, a contra entry of $400 had to be posted. The provision for doubtful debts must be kept at $5\%$ of trade receivables. What amount of doubtful debts was included in the income statement?

  • A$215
  • B$235
  • C$470
  • D$685

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