DOUBTFUL DEBTS - NET CREDIT SALES METHOD
The following details were obtained from the accounting records of Civil Construction Consul-tants at the end of the financial year.
Consulting fee owing $470 000 (excludes GST)
Allowance for doubtful debts 30 000
Debts to be written off 9100 (excludes GST)
The firm requires an allowance for doubtful debts of 10% of outstanding fees at 30 June. Ignore GST.
Required
A. Prepare the appropriate general journal entries.
B. Prepare and balance the Allowance for Doubtful Debts account at 30 June 2015.
C. Show the amount(s) to be charged as bad debts expense for the year.