(iv) Explain TWO (2) methods use in estimating the amount to be provided (4 marks) for...

 

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(iv) Explain TWO (2) methods use in estimating the amount to be provided (4 marks) for allowance for doubtful debts. Briefly comments on the effect to the financial statements if the allowance for doubtful debt is not taken into account during the year. In your explanation, provide which accounting concept would be violated if this circumstance occurs. (v) (5 marks) (vi) List any TWO (2) possible reasons that give rise to bad debts. (2 marks) (iv) Explain TWO (2) methods use in estimating the amount to be provided (4 marks) for allowance for doubtful debts. Briefly comments on the effect to the financial statements if the allowance for doubtful debt is not taken into account during the year. In your explanation, provide which accounting concept would be violated if this circumstance occurs. (v) (5 marks) (vi) List any TWO (2) possible reasons that give rise to bad debts. (2 marks)

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1 methods used to estimate amount to be provided for allowance of doubtful debts 1 Risk classification With this method assign each customer a risk score about the likelihood of them leaving debts unp... View the full answer