Trade Receivables Calculation in Financial Statements Assessment 1
Katie2014
Registered Posts: 29 Regular contributor ⭐
Hi, if possible could someone please explain the trade receivables calculation in 1.2 of Sample Assessment 1 for financial statements. The answer is 12294 however Trade Receivables is 12447 - 47 allowance for doubtful debt + 130 prepayment for distribution costs = 12530? If someone could please explain where I am going wrong I would be very grateful.
Thank you
Katie
Thank you
Katie
0
Comments
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Hi Katie,
Whilst only the change in allowance for doubtful debts is taken to the income statement, the full amount is reflected on the SoFP. Therefore your deduction should be the 47k increase plus the existing 236k provision b/f from the prior year.
Hope that answers your question.0 -
Thank you for explaining CeeJay!0
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Hi, Sorry to ask when you commented so long ago! Please can you explain how you know that £130 is a prepayment for distribution costs? I think I have missed something somewhere!
Thank you
VictoriaKatie2014 said:Hi, if possible could someone please explain the trade receivables calculation in 1.2 of Sample Assessment 1 for financial statements. The answer is 12294 however Trade Receivables is 12447 - 47 allowance for doubtful debt + 130 prepayment for distribution costs = 12530? If someone could please explain where I am going wrong I would be very grateful.
Thank you
Katie0
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