An extract of Trial balance from the books of Tahiliani and Sons Enterprises
on March 31, 2017 is given below:
[tex]
\begin{tabular}{c c c}\\
Name of the Account & Debit Amount & Credit Amount \\
& Rs. & Rs.\\
Sundry debtors.& 50,000 & \\
Bad debts & 6,000 & \\
Provision for doubtful debts & & 4,000
\end{tabular}
[/tex]
Additional Information:
• Bad Debts proved bad but not recorded amounted to Rs. 2,000.
• Provision is to be maintained at 8
of Debtors.
Give necessary accounting entries for writing off the bad debts and creating
the provision for doubtful debts account. Also show the necessary accounts.
Answers
Answer:
you can. do this question by application of formula
Accounting Entries for writing off Bad debts with necessary accounts.
Explanation:
In the books of Tahiliani
Journal:
- Bad debts A/c Dr. Rs.2000
To Debtors A/c Rs.2000
(Being bad debts charged to Debtors A/c)
- Provision for DD A/c Dr. Rs.8000
To Bad debts A/c Rs.8000
(Being Bad debts transferred to PFDD A/c)
- P&L A/c Dr. Rs.7840
To Prov. for DD A/c Rs.7840
(Being PFDD charged to P&L A/c)
Ledgers:
1) Bad Debts A/c
Particulars Amount(Rs.) Particulars Amount(Rs.)
To Balance b/d 6000 By PFDD 8000
To Debtors A/c 2000
8000 8000
2) Debtors A/c
Particulars Amount(Rs.) Particulars Amount(Rs.)
By Balance b/d 50000 To Bad debts 2000
To Balance c/d 48000
50000 50000
3) Provision for Doubtful Debts A/c
Particulars Amount(Rs.) Particulars Amount(Rs.)
To Bad debts 8000 By Balance c/d 4000
To Balance c/d 3840 By P&L A/c 7840
11840 11840