Journal Entries
To write off bad debt expense
What is debit bad debt expense account, credit accounts receivable?
The principles that states each debit entry must have a corresponding credit entry
What is dual aspect principle?
This method uses the number of years, scrap value, and cost of the asset to calculate.
What is the straight line method?
Expenses owing and revenues outstanding at the end of the year
What are accruals?
The amount in the provision for doubtful debts account if it is 5% of $25000.
What is $1250?
To record the depreciation expense for the year
What is debit profit and loss account, credit provision for depreciation?
This principle states that expenses must be recorded when incurred and revenues recorded when earned and not only when cash is paid or received.
What is the accruals concept?
The cost minus the accumulated depreciation of an asset
What is the Net Book Value?
Expenses prepaid and revenues received in advance at the end of the year
What are prepayments?
Amount on the income statement Provision for doubtful debts balance at the beginning of the year is $490 and the balance at the end of the year is $500
What is $10?
To create the provision for doubtful debts
What is Debit Profit and loss account, credit Provision for doubtful debts?
The principle that states assets and revenues must not be overstated and expenses and liabilities must not be understated.
What is the prudence principle?
The value of accumulated depreciation of an asset at the end of its first year
What is zero?
The income statement amount, if the expense amount paid is $3500, including a prepaid amount of $400.
What is $3100?
The amount on the balance sheet at the end of the year if the provision for doubtful debts is $600.
What is $600?
To decrease the provision for doubtful debts
What is Debit Provision for doubtful debts, credit Profit and loss account?
The principle that states a business' accounts must be kept separate from its owners'.
What is the business entity principle?
The provision for depreciation account is an example of this type of account.
What is contra-asset account?
What is $1000?
If the provision for doubtful debts decreased at the end of year, the treatment to gross profit
What is add difference to gross profit?
To record the expense used in the income statement
What is Debit Income statement, Credit expense account
The principle states that the assets must be recorded at its original value
What is historical cost principle?
The amount to be recorded on the balance sheet for accumulated depreciation at the end of the year, if a business had accumulated depreciation of $4,000 at the beginning of the year for an asset costing $40,000 and depreciation expense is 10% on the reducing balance.
What is $7600?
A business earned $ 50,000 for the year
What is Revenue?
The entry in the provision for doubtful debts account if the business had a provision for doubtful debts balance at the beginning of the year at $930 but a balance at the end of the year of $800.
Hint: Amount and the side of the account
What is a $130, debit?