A business has made a gross profit of 126,734 and a net profit of 64,211. Debtors amount

Question:

A business has made a gross profit of £126,734 and a net profit of £64,211.

Debtors amount to £32,967 before bad debts of £467 have been written off.

A provision for doubtful debts of 4% is required.


Required

Select the correct answer:

The provision for doubtful debts is calculated as 4% of:

A. £32,500

B. £32,967

C. £64,211

D. £126,734

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