Question 2 Chapter 12 – Class 11 Unimax

Question 2 Chapter 12 – Class 11 Unimax

An extract of the trial balance from the books of Tahiliani and sons enterprise on December 31, 2019, is given below:

Name of the account	Dr. Amount	Cr. Amount
Sundry debtors	50,000
Bad debts	6,000
Provision for doubtful debts		4,000

Addition information-
*Bad debts proved bad but not recorded amounted to ₹ 2,000.

*Provision is to be maintained at 8% of debtors.

Give necessary accounting entries for writing off the bad debts and crediting the provision for doubtful debts account. Also show the necessary accounts.

The solution of Question 2 Chapter 12 – Class 11 Unimax

Journal

Date	Particulars		L.F.	Debit	Credit
2019
Dec.31	Bad debts A/c	Dr.		2,000
	To debtors A/c				2,000
	(Being further bad debts written off)
Dec.31	Provision for doubtful debts A/c	Dr.		8,000
	To Bad debts A/c				8,000
	(Being total bad debts transferred to provision a/c)
Dec.31	Profit & Loss A/c	Dr.		7,840
	To Provision for doubtful debts A/c				7,840
	(Being net amount charged from P&L A/c)

 

Dr	Bad debts A/c			Cr
Date	Particulars	J.F.	Amount	Date	Particulars	J.F.	Amount
2019				2019
Dec.31	To Balance b/d		6,000	Dec.31	By provision for doubtful debts A/c		8,000
Dec.31	To Sundry Debtors A/c		2,000
			8,000				8,000
Dr	Provision for doubtful debts A/c			Cr
Date	Particulars	J.F.	Amount	Date	Particulars	J.F.	Amount
2019				2019
Dec.31	To Bad debts A/c		8,000	Jan.1	By Balance b/d		4,000
Dec.31	To Balance c/d		3,840	Dec.31	By profit & loss A/c		7,840
			11,840				11,840
				2020
				Jan.1	By Balance b/d		3,840

 

Dr	Profit & Loss A/c		Cr
Particulars	Amount	Particulars	Amount
To Provision for doubtful debts A/c	7,840

Working Note:

Net amount chargeable to P & L a/c
Bad debts	6,000
Add: further bad debts	2,000
	8,000
Add: New provision (8%on ₹ 48,000)	3,840
	11,840
Less: old provision	4,000
	7,840