Accounts (Principles of Accounts)Accruals, prepayments and provisionsJAMB
Debtors are ₦80,000 and the provision for doubtful debts is to be 5%. The existing provision is ₦3,000. The amount charged to profit and loss is
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Answer: C. ₦1,000
New provision 5% × 80,000 = 4,000; only the increase of 4,000 − 3,000 = ₦1,000 is charged.
An AdmitMe practice question, written for the JAMB syllabus. Not an official past question.