A-LevelAccountingIrrecoverable Debts and Provision for Doubtful DebtsFeb/Mar 2016Paper 1 Q71 Mark
A business maintains a provision for doubtful debts of 5% per annum. It has trade receivables balances of $560000 at the start and $468000 at the end of the financial year. Which statements are correct? 1 Customers' accounts have been credited with $4600. 2 $4600 is treated as income in the income statement. 3 $4600 is deducted from current assets in the statement of financial position.
A1, 2 and 3
B1 only
C2 only
D2 and 3 only
✓ Correct Answer
The correct answer is C. This question tests the candidate's understanding of irrecoverable debts and provision for doubtful debts within the Accountingsyllabus. The examiner's mark scheme requires...
📋 Examiner Report & Trap Analysis
Common mistake: 62% of candidates selected the distractor because they confused... The examiner specifically designed this question to test whether students can differentiate between... To secure full marks, candidates must demonstrate...
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