Vettori Ltd has the following information from an aged debtors listing for the current period. $$\begin{array} { | l | r | }
\hline \text { Age } & \text { Amount } \
\hline \text { Less than } 1 \text { month old } & \$ 80000 \
\hline \text { Between } 1 \text { month and } 2 \text { months old } & \$ 60000 \
\hline \text { Between } 3 \text { and } 5 \text { months old } & \$ 30000 \
\hline \text { Over } 5 \text { months old } & \$ 5000 \
\hline
\end{array}$$ Based on experience in the industry,Vettori Ltd uses the following basis for estimating uncollectible amounts: $$\begin{array} { | l | l | }
\hline \text { Age } & \begin{array} { l }
\text { Percentage } \
\text { uncollectible }
\end{array} \
\hline \text { Less than } 1 \text { month old } & 0.50 \% \
\hline \text { Between } 1 \text { month and } 2 \text { months old } & 2.00 \% \
\hline \text { Between } 3 \text { and } 5 \text { months old } & 5.00 \% \
\hline \text { Over } 5 \text { months old } & 20 \% \
\hline
\end{array}$$ Assuming that the current balance in the provision for doubtful debts is zero,what is the entry to record the provision for this period?
What is the entry to record the writing off of a bad debt of $1000 when a debtor goes bankrupt?

Question

Vettori Ltd has the following information from an aged debtors listing for the current period. $$\begin{array} { | l | r | } 
\hline \text { Age } & \text { Amount } \
\hline \text { Less than } 1 \text { month old } & \$ 80000 \
\hline \text { Between } 1 \text { month and } 2 \text { months old } & \$ 60000 \
\hline \text { Between } 3 \text { and } 5 \text { months old } & \$ 30000 \
\hline \text { Over } 5 \text { months old } & \$ 5000 \
\hline
\end{array}$$ Based on experience in the industry,Vettori Ltd uses the following basis for estimating uncollectible amounts: $$\begin{array} { | l | l | } 
\hline \text { Age } & \begin{array} { l } 
\text { Percentage } \
\text { uncollectible }
\end{array} \
\hline \text { Less than } 1 \text { month old } & 0.50 \% \
\hline \text { Between } 1 \text { month and } 2 \text { months old } & 2.00 \% \
\hline \text { Between } 3 \text { and } 5 \text { months old } & 5.00 \% \
\hline \text { Over } 5 \text { months old } & 20 \% \
\hline
\end{array}$$ Assuming that the current balance in the provision for doubtful debts is zero,what is the entry to record the provision for this period?
What is the entry to record the writing off of a bad debt of $1000 when a debtor goes bankrupt?

Quizplus · Accepted Answer

The Answer of Vettori Ltd has the following information from an aged debtors listing for the current period. $$\begin{array} { | l | r | } 
\hline \text { Age } & \text { Amount } \
\hline \text { Less than } 1 \text { month old } & \$ 80000 \
\hline \text { Between } 1 \text { month and } 2 \text { months old } & \$ 60000 \
\hline \text { Between } 3 \text { and } 5 \text { months old } & \$ 30000 \
\hline \text { Over } 5 \text { months old } & \$ 5000 \
\hline
\end{array}$$ Based on experience in the industry,Vettori Ltd uses the following basis for estimating uncollectible amounts: $$\begin{array} { | l | l | } 
\hline \text { Age } & \begin{array} { l } 
\text { Percentage } \
\text { uncollectible }
\end{array} \
\hline \text { Less than } 1 \text { month old } & 0.50 \% \
\hline \text { Between } 1 \text { month and } 2 \text { months old } & 2.00 \% \
\hline \text { Between } 3 \text { and } 5 \text { months old } & 5.00 \% \
\hline \text { Over } 5 \text { months old } & 20 \% \
\hline
\end{array}$$ Assuming that the current balance in the provision for doubtful debts is zero,what is the entry to record the provision for this period?
What is the entry to record the writing off of a bad debt of $1000 when a debtor goes bankrupt?

Vettori Ltd Has the Following Information from an Aged Debtors