Accounting 9706 · AS & A Level · The accounting system

The accounting system — practice question

A business set up a provision for doubtful debts on 31 December 2016. The provision was worked out as a percentage of trade receivables at each year end, as shown below. 31 December 2016: trade receivables $32500, provision for doubtful debts 10% 31 December 2017: trade receivables $34300, provision for doubtful debts 5% Which entry was needed in the provision for doubtful debts account for the year ended 31 December 2017?

  • A$1535 credit
  • B$1535 debit
  • C$1715 credit
  • D$1715 debit

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