Balance Payment Journal Entry

A business sells products for $ 50000 on credit
25% of the balance is received cash and 10 by cheques
5% of the balance has become irrecoverable and write off
A provision of 5% is made for the remaining balance in year one and 3% in year 2 where the balance remain unchanged. Pass Journal Entry for this Scenario

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Raemsh

  • Apr 30th, 2017
 

Particular Dr Cr
Customer A/C 500,000.00
To Sale A/C 500,000.00


Cash A/C 125,000.00
To Customer A/C 125,000.00

Bank Account 50,000.00
To Customer A/C 50,000.00

Written Off 25,000.00
To Customer A/C 25,000.00


Bad debts provision for 1st Year

Profit & Loss 15,000.00
To Provision for Bad debts 15,000.00


Bad debts provision for 2nd Year

Profit & Loss 8,550.00
To Provision for Bad debts 8,550.00

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