Calculate the new provision for doubtful debts, given sundry debtors of Rs. 52,000 and bad debts of Rs. 2,000, with a provision rate of 5%.

Step 1: Calculate the adjusted sundry debtors. The bad debt of Rs. 2,000 needs to be written off from the sundry debtors. Adjusted Sundry Debtors = Sundry Debtors - Bad Debt Adjusted Sundry Debtors = Rs. 52,000 - Rs. 2,000 Adjusted Sundry Debtors = Rs. 50,000 Step 2: Calculate the new provision for doubtful debts. The new provision for doubtful debts is to be maintained at 5% of the adjusted sundry debtors. New Provision for Doubtful Debts = 5\% × Adjusted Sundry Debtors New Provision for Doubtful Debts = 0.05 × Rs. 50,000 New Provision for Doubtful Debts = Rs. 2,500 The required balance for the Provision for Bad Debt account is the new provision for doubtful debts. The final answer is Rs. 2,500. Send me the next one 📸