Question

28. The following informations appear in the books of a concern.
Provision for doubtful debts 1.1.05 6,500
Bad debts written of during the year 4,000
Sundry debtors on 31.12.05
75,000
Of the sundry debtors 2000 was bad and provision for doubtful
debt was to be maintained at 5% on sundry debtors.
Show journal, bad debts account, provision for doubtful debts account
and the relanent extracts of profit and loss account and balance sheet.
(Ans : Bad debts a/c total 6,000; Provision for bad debts a/c Total 9,650
P&L Account 3,150, B/S 69,350)
(M.S. University 2007)​

Answer 1

Answer:

The balance in provision for bad debts is appearing in trial balance Rs.4000, of which bad debts of Rs.2000 is written off. Balance lying in provision