PRC-1 · Chapter 5 · Question 88 of 100
If 'Nexus Corp' has a total receivables balance of Rs. 500,000 and the allowance for doubtful debts is Rs. 25,000, what is the 'Carrying Amount' of the receivables in the balance sheet?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Rs. 475,000
Explanation
The carrying amount (Net Trade Receivables) is the gross balance minus the allowance. 500,000 - 25,000 = Rs. 475,000.
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