O-LevelAccountingAccounting procedures7707/12 · May/June 2018 · Q101 Mark

Rashid maintains a provision for doubtful debts of 5% of the trade receivables at the end of each year. Trade receivables owed $40000 on 31 March 2017. Trade receivables owed $46000 on 31 March 2018. Which journal entry should Rashid make on 31 March 2018?

Aincome statement 300 provision for doubtful debts 300

Bincome statement 2300 provision for doubtful debts 2300

Cprovision for doubtful debts 300 income statement 300

Dprovision for doubtful debts 2300 income statement 2300

✓ Correct answer

A: income statement 300 provision for doubtful debts 300

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Topic: Accounting procedures, O-Level Accounting (syllabus 7707). Multiple choice, 1 mark.
Source: O-Level Accounting, May/June 2018 Paper 1 Variant 2, question 10.

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