he owner of Yummy Seafood, a seafood supermarket. The business accounts for GST on an accrual basis. Jo sells various seafood on account to various restaurants in NSW. The restaurants are also all registered for GST. Recently, Jo received a letter (dated 1 July 2020) from one restaurant advising her that the restaurant was struggling and as a result they are likely not able to pay Jo’s total bill ($220,000) by the payment due date, including GST. As a result, Jo has decided to recognise an expense provision totalling $100,000 as at 1 July 2020. Subsequently, on 1 July 2021 Jo has been advised that the restaurant will declare bankruptcy and accordingly, Jo has fully written off
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Jo is the owner of Yummy Seafood, a seafood supermarket. The business accounts for GST on an accrual basis. Jo sells various seafood on account to various restaurants in NSW. The restaurants are also all registered for GST. Recently, Jo received a letter (dated 1 July 2020) from one restaurant advising her that the restaurant was struggling and as a result they are likely not able to pay Jo’s total bill ($220,000) by the payment due date, including GST. As a result, Jo has decided to recognise an expense provision totalling $100,000 as at 1 July 2020. Subsequently, on 1 July 2021 Jo has been advised that the restaurant will declare bankruptcy and accordingly, Jo has fully written off the
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