The trial balance of Kanine Bros as at $31$ May $20$X$7$ includes the following: Debit Credit $\pounds \pounds$ Trade receivables $60,500$ Allowance for receivables at $1$ June $20$X$61,420$ Subsequently a review of the receivables ledger reveals the following: Debts totaling $\pounds 2,100$ are considered irrecoverable and are to be written off. The business wishes to reduce the allowance for receivables to $\pounds 800.$ What is the irrecoverable debt charge or credit to be included in the statement of profit or loss for the year ended $31$ May $20$X$7?$ Calculate.

Answer rating: 100% (QA)

There are two distinct calculations needed in this scenario and both involve adjusting the allowance ... View the full answer