Acca financial Accounting (FA) Study Text ac ca (FA)

What balances will be shown in Harold’s statement of financial 

position at the year-end for receivables and the allowance for 

receivables? 

 $ 

Receivables  

Allowance for receivables 

 

37  James has been advised that one of his customers has ceased trading 

and that it is almost certain that he will not recover the balance of $720 

owed by this customer. 

What accounting entries should James make in his general ledger to 

record this situation? 

A Dr 

  Receivables 

$720 

 Cr  Irrecoverable 

debts 

$720 

 

Being write off of irrecoverable debt 

 

B 

Dr  

Irrecoverable debts 

$720 

 Cr 

 Receivables 

$720 

 

Being write off of irrecoverable debt 

 

C Dr 

  Receivables 

$720 

 Cr 

  Bank 

$720 

 

Being write off of irrecoverable debt 

 

D Dr 

  Bank 

$720 

 Cr 

 Receivables 

$720 

 

Being write-off of irrecoverable debt. 

 

 

 

---