MGT 101 Assignment#2 Another Solution

Assignment # 2

Financial Accounting (MGT 101)

QUESTION: 1

1. Calculate new provision.

Debtors	205,000
Write off	5000
Debtors – Write off Bad debts 205,000 – 5000 = 200,000
New Provision   (200,000 * 5/100)	10,000

2. Calculate the amount of Provision for doubtful debts to be appeared in Profit and

Loss Account.

Bad debts	8,000
Add : Write off	5,000
	13,000
Add : New Provision	10,000
	23,000
Less : old Provision	6,000
Provision for doubtful debt	17,000

3. Calculate the amount of Sundry debtors to be shown in Balance Sheet.

Debtors	205,000
Less : Write off bad debts	5,000
	200,000
Less : New Provision	10,000
Sundry debtors in balance sheet	190,000

QUESTION: 2

Mr. Ali

For the year ended on 30 June 2010

(Debtors Control Account)

Date	No	Narration	Debit	Date	No	Narration	Credit
		Opening balance	25,000			Discount allowed	2,000
		Credit sale	50,000			Receipts from debtors	35,000
						Bad debts	10,000
						Sales return	5,000
						Closing balance	23,000
		Total	75,000			Total	75,000