While accounting for accounts receivable for Easy DVD Ltd, the following information became available to the accountant. The company provides an allowance for doubtful debts at the rate of 3% of accounts receivable at 30 June each year. The balance of the Allowance for doubtful Debts account on 1 July 2018 was $10 000 CR. To 30 June 2019, debts amounting to $12 000 were written off as bad debts. On 30 June 2019, the Accounts Receivable (GST exclusive) account balance was $400 000. On 1 July 2019, Easy DVD Ltd registered for GST and started to account for GST in its accounting system. To 30 June 2020, debts amounting to $16 500 were written off. On 30 June 2020, the Accounts Receivable (GST inclusive) account balance was $495 000. Required: Prepare the necessary general journal entries (narrations not required).

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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While accounting for accounts receivable for Easy DVD Ltd, the following information became available to the accountant. The company provides an allowance for doubtful debts at the rate of 3% of accounts receivable at 30 June each year. The balance of the Allowance for doubtful Debts account on 1 July 2018 was $10 000 CR.

 

To 30 June 2019, debts amounting to $12 000 were written off as bad debts. On 30 June 2019, the Accounts Receivable (GST exclusive) account balance was $400 000.

 

On 1 July 2019, Easy DVD Ltd registered for GST and started to account for GST in its accounting system. To 30 June 2020, debts amounting to $16 500 were written off. On 30 June 2020, the Accounts Receivable (GST inclusive) account balance was $495 000.

 

Required: Prepare the necessary general journal entries (narrations not required).

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