• 2022-05-30
    At 1 November 20X5, Sanjay Motors is owed $20,000 by Jackson for servicing and repair work carried out on Jackson's fleet of motor vehicles.Of the $20,000 outstanding, $3,500 relates to work that Jackson feels was sub-standard. Despite discussions and negotiation, and although Jackson is generally a 'good customer', Sanjay is doubtful that Jackson will ever pay this $3,500.What allowance for receivables should Sanjay Motors make to account for this doubtful debt?
    A: None, Jackson is a good customer so Sanjay Motors should assume they will eventually pay
    B: A specific allowance of $20,000 as Jackson may decide not to pay any of their debt
    C: A general allowance of $3,500
    D: A specific allowance of $3,500