Accounting Multiple Choice Question – 31 October 2021

A company has the following balances.

trade debtors at 31 December 2020  —  £125,400

provision for doubtful debts at 1 January 2020  —  £1,800

During the year ended 31 December 2020, bad debts of £20,500 were written off.

The company provides for 5% of trade debtors at each year end.

What is the doubtful debts expense for the year ended 31 December 2020?

Select ONE answer:

1. £27,000
2. £28,000
3. £29,000
4. £30,000

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 2

1. Not correct
2. Correct ==> £150,000 – £10,000 = £140,000 / 5 = £28,000
3. Not correct
4. Not correct

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