Exam 3: Double-Entry Bookkeeping 1: Debits, Credits, T-Accounts, the Trial Balance, and the Financial Statements

Segovia Limited receives £4,000 from a trade receivable previously written off as an irrecoverable debt. What is the correct double entry to record this transaction?

Which one of the following statements is true?

Fedora Limited has a year end of 30 September. At 30 September 2020, the allowance for receivables was £19,795. At 30 September 2021, the allowance for receivables was £16,800. What is the correct double entry to record this movement in the allowance for receivables?

At 1 January 2021, the allowance for receivables of Trader Limited stood at £22,375. During the financial year ended 31 December 2021, Trader Limited made sales of £852,639, received cash from customers of £858,772 and had irrecoverable debts of £6,400. The total trade receivables at 1 January 2021 were £70,080. The allowance for receivables at 31 December 2021 had been reduced to £19,221. What figure for trade receivables will appear in Trader Limited's trial balance at 31 December 2021?

During the financial year ended 31 October 2021, Susie granted her credit customers early settlement discounts of £9,200. However, only £3,700 of these discounts were taken up by her customers, with the remainder paying the full amount for their purchases. What is the correct double entry to record the discounts allowed not taken up by Susie's customers?

The balances on asset, liability and income accounts are all carried forward to the next accounting period when accounts are closed off at the end of each accounting period.