Accounting 0452 · IGCSE · Irrecoverable debts and provision for doubtful debts

Irrecoverable debts and provision for doubtful debts — practice question

Beena keeps a provision for doubtful debts equal to $3\%$ of trade receivables at the close of each financial year. On 1 September 2019, the provision for doubtful debts was $900$. By 31 August 2020, trade receivables had reached $42\,800$. Which journal entry was recorded by Beena on 31 August 2020?

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