Prepare provision for depreciation account

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Question - a) A firm purchases a truck for a sum of Ksh 1,000,000 on 1st Jan 2020. It charges a depreciation of at the rate of 20% p.a according to reducing balance method. The truck was sold on 1.07.2020 for 800,000.

Required - Prepare Provision for depreciation account.

b) The balances from the Trial balance of Gibs ltd show that the company had sundry Debtors amounting to Ksh.300,000 as at 31 Dec 2020. Bad debts are provided at 10% and provision for doubtful debts at 10%. Ksh, 5000 (bad debt)previously written off was recovered in year 2020.

Required - Prepare and extract of both P&L account and Balance sheet as at 31 Dec 2020.

Reference no: EM132991201

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