The balance in the Debtors Control account at the end of the financial year was R36 000 before the following two transactions were recorded: A debtor who owed R4 000 was declared insolvent and his account must be written off. A. Smith, whose account was previously written off, settled his debt of R1 000. How much will be reflected as "Provision for bad debts" in the statement of financial position, if the provision for bad debts is calculated at 5% of trade debtors?

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Heres how to calculate the provision for bad debts in this scenario 1 Adjust the Debt... View the full answer