PRC-1 · Chapter 5 · Question 49 of 100
A business wrote off Rs. 26,000 in bad debts during the year. Its opening allowance was Rs. 30,000. It desires a closing allowance of Rs. 22,000. What is the total Bad and Doubtful Debt expense charged to the Statement of Profit or Loss?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Rs. 18,000
Explanation
Bad debt written off = 26,000 expense. The allowance decreases from 30,000 to 22,000, creating an 8,000 reduction in expense. Total charge = 26,000 - 8,000 = Rs. 18,000.
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