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Following in the extract from the Trial Balance of a firm as at 31st March, 2019: |{:("Heads Accounts",Dr. Rs.,Cr. Rs.),("Sundry Debtors","4,10,000","..."),("Provision for Doubtful Debts","...","20,000"),("Bad Debts"," 6,000","..."):}| Additional information : (i) Additional bad debts Rs 10,000. (ii) Maintain Provision for Doubtful Debts @10% on sundry debtors. Pass necessary Journal entries and show relevant accounts (including Final Accounts). |
Answer» Solution :  Note : Bad Debts GIVEN in ADJUSTMENTS (i.e., Further Bad debts) are shown on the debit side of the profit and Loss Account and deducated form sundry DEBTORS on the assets side of the BALANCE Sheet. PROVISION for Doubtful debts (New) is calculated on sundry debtors after deducating further of bad debts. |
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