DB Limited has opening balances at January 1, 2023 on their debtors account and provision
for doubtful debts account of $750,000 and $440,000 respectively. During the year, DB
Limited made credit sales of $800,000 and received cash from his debtors of $550,000.
At December 31, 2023 DB Limited received the debtors listing and acknowledges that they
are unlikely ever to receive debts totalling $200,000. These are to be written off as bad. DB
Limited also wishes to make provisions for 20% of the remaining debtors after writing off
the bad debts.
Prepare:
(a) The debtors account up to January 1, 2024.
(b) The provision for doubtful debts account up to January 1, 2024.
(c) The bad debt expense account up to January 1, 2024.
(d) The Balance Sheet Extract for 2024.