Question

If the credit sale Rs. 80,000, cash received from
debtors Rs. 15,000 and bad debts Rs. 2,500, then t
amount of closing debtors will be
O Rs.
65,000
Rs.
62,500
O Rs.
60 on
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Answer 1

Answer:

rs 60....................................

Answer 2

The amount of "closing debtors" will be ₹62,500.

Calculation of the "amount of closing debtors":

• Debtors are the persons who owe the business money. The credit sales of products are regarded as the amount of the debtors. If the debtors are unable to pay the amount, it is deducted from the amount of debtors as it is uncollectable.

• Here credit sales during the year are ₹80,000. so the amount of debtors, in the beginning, is ₹80,000.
• cash received from debtors during the year will be deducted from the total debtors. The cash received is ₹15,000. After deducting cash received from debtors, the amount of debtors is = 80,000 - 15,000 = ₹65,000.
• Further, unpaid debt is deducted from the debtors as they are not included in closing debtors. Amount of debtors after deducting uncollectable debt = 65,000 - 2,500 = ₹62,500.
• Therefore the amount of closing debtors is ₹62,500.