Question two Ben karaibu commenced business on 1st January 2005 and his financial year closes on 31 December. For the year ended 31 December 2005, bad debts written off amounted to sh. 56,00 and a provision for doubtful debts of sh 104,000 was found necessary. In the year ended 31 December 2006: 1. bad debts written off amounted to sh 88,000 2. John Njoroge, whose debt amounting to sh. 8400 was among those written off in 2005, settled his debt 3. total debts outstanding as at 31 December 2006 stood at sh. 3,680,000 4. it was decided to provide for doubtful debts at 5% of outstanding total debts In the year ended 31 December 2007: 1. Bad debt amounting to sh. 152,000 were written off 2. A recovery of sh 12,800 was made in respect of debts written off in 2006 3. As at 31 December 2007, total debts outstanding stood at sh 2,880,000 4. The provision for doubtful debts was raised to 6% of the outstanding total debts. Required: Bad debts written off account for each of the year ended 31st Dec 2005, 2006 & 2007 b. Bad debts recovered account for each of the years ended 31st Dec 2005 2006 2007 a.

Question two Ben karaibu commenced business on 1st January 2005 and his financial year closes on 31 December. For the year ended 31 December 2005, bad debts written off amounted to sh. 56,00 and a provision for doubtful debts of sh 104,000 was found necessary. In the year ended 31 December 2006: 1. bad debts written off amounted to sh 88,000 2. John Njoroge, whose debt amounting to sh. 8400 was among those written off in 2005, settled his debt 3. total debts outstanding as at 31 December 2006 stood at sh. 3,680,000 4. it was decided to provide for doubtful debts at 5% of outstanding total debts In the year ended 31 December 2007: 1. Bad debt amounting to sh. 152,000 were written off 2. A recovery of sh 12,800 was made in respect of debts written off in 2006 3. As at 31 December 2007, total debts outstanding stood at sh 2,880,000 4. The provision for doubtful debts was raised to 6% of the outstanding total debts. Required: Bad debts written off account for each of the year ended 31st Dec 2005, 2006 & 2007 b. Bad debts recovered account for each of the years ended 31st Dec 2005 2006 2007 a.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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