Smarkly Limited uses the income statement approach to account for bad debts and allowance for doubtful debts. The following information is available: 1 2 3 4 5 Past experience suggests that 1 per cent of net credit sales will become uncollectable. Credit sales for the year ended 30 June 2022, $3 200 000. Cash sales for the year ended 30 June 2022, $700 000. Bad debts written off during the year ended 30 June 2022, $17 000. Present balance of allowance for doubtful debts account, $21 000. Prepare the necessary journal entry or entries to account for bad debts for the year ended 30 June 2022. Show all workings.

Smarkly Limited uses the income statement approach to account for bad debts and allowance for doubtful debts. The following information is available: 1 2 3 4 5 Past experience suggests that 1 per cent of net credit sales will become uncollectable. Credit sales for the year ended 30 June 2022, $3 200 000. Cash sales for the year ended 30 June 2022, $700 000. Bad debts written off during the year ended 30 June 2022, $17 000. Present balance of allowance for doubtful debts account, $21 000. Prepare the necessary journal entry or entries to account for bad debts for the year ended 30 June 2022. Show all workings.

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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