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QUESTION 5 [18 MARKS] Venezuela Ltd sells outdoor furniture. The company is not registered for GST. The accounting records at 30 June 2020 reveal the following balances: $ Credit sales (for year) 1,070,000 Credit sales returns & allowances 90,000 Accounts receivable 323,500 Allowance for doubtful debts (credit balance) 1,500 In the past, the company's yearly bad debts expense had been estimated at 2% of credit sales. It was decided to compare that method with an ageing of the accounts receivable method. The following analysis was obtained in relation to the accounts receivable: % estimate Balance uncollectable Accounts not yet due $173,600 1.5 Accounts overdue: 10-30 days 60,000 3 31-60 days 42,000 10 61-120 days 26,400 25 121 days and over 21.500 40 323.500