Accounting 9706 · AS & A Level · Reconciliation and verification

Reconciliation and verification — practice question

The following data are provided for a business. Trade receivables on $1$ January $2018$: $63000 Provision for doubtful debts on $1$ January $2018$: $1890 Total credit sales for the year: $327000 Cash collected from credit customers in the year, after $4\%$ cash discount: $324000 A provision for doubtful debts of $2\%$ is to be created. Which amount is shown in the income statement for the year ended $31$ December $2018$?

  • A$570 expense
  • B$570 income
  • C$840 expense
  • D$840 income

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