A firm has in the past provided for bad debts on the basis of 10% of yr end trade receivables.The provision brought forward (brought down) on 1 Jan 2006 was €520

During the yr ended 31 December 2006 the bad debts written off amounted to €620 and the remaining trade receivables totalled €7,400. On 30 Sep a bad debt of €300 written off in 2003 was recovered.The usual provision for doubtful debts is to be made.

Required for year ended 31 December 2006;-
a)The bad debts account and the provision for bad debts account
b)The relevant extracts from the income statement and balance sheet