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BTEB HSC Business Management & Technology (HSC BMT) study materials
BTEB HSC Business Management & Technology (HSC BMT) study resources

BTEB HSC Business Management & Technology (HSC BMT) practice questions

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Question 1Business Organization and Management

Which statement correctly describes the owner's liability in a sole proprietorship?

  1. Liability is shared equally between the owner and the firm's creditors
  2. Liability is limited to the amount of capital invested by the owner
  3. Liability is limited to twice the capital contributed by the owner
  4. The owner bears unlimited personal liability for business debts Correct answer.

Explanation

A sole proprietor and the business are not separate legal persons, so the owner's personal assets can be used to settle business debts. Limited liability belongs to incorporated bodies such as companies, where the invested capital normally caps the owner's exposure.

Question 2Business Organization and Management

A written partnership deed normally states which of the following?

  1. The number of shares that the public may hold
  2. The ratio in which partners share profits and losses Correct answer.
  3. The market price at which the firm's shares are traded
  4. The income tax rate that the firm must pay

Explanation

The partnership deed is the agreement that governs relations among partners, and its central contents are capital contributions, the profit and loss sharing ratio, and the duties of each partner. Share matters and statutory tax rates lie outside the deed because they are not settled by the partners themselves.

Question 3Business Organization and Management

In a joint stock company, ownership of the business is represented by which of the following?

  1. The loan agreement signed with the lending bank
  2. The partnership deed signed by the founding members
  3. The personal property of the managing director
  4. The shares held by the company's shareholders Correct answer.

Explanation

A joint stock company is a separate legal entity whose capital is divided into shares, so ownership is evidenced by holding those shares and carrying voting and dividend rights. A deed, a director's personal property, or a loan contract creates a different relationship and does not confer ownership.

Question 4Business Organization and Management

A supervisor oversees 30 workers who all report directly to him, and he can no longer monitor their work properly. Which measure best corrects the situation?

  1. Create an intermediate level of supervision Correct answer.
  2. Increase the number of direct subordinates reporting to the manager
  3. Give every subordinate equal authority to make decisions
  4. Abolish the supervisory level altogether

Explanation

Span of control is the number of subordinates reporting directly to one manager. When that number exceeds what one person can supervise, adding an intermediate level narrows the span and restores effective control, whereas adding subordinates or removing supervision makes the overload worse.

Question 5Business Organization and Management

A production manager hands part of his authority to a supervisor but still answers to the plant head for the supervisor's results. What does this show about delegation?

  1. Accountability is delegated along with authority
  2. Authority stays with the manager while only the work is passed on
  3. Delegation removes the manager's responsibility for results
  4. Authority can be delegated but accountability cannot Correct answer.

Explanation

Delegation transfers authority and the duty to perform the work, yet the delegating manager remains answerable for the outcome. Accountability therefore stays with the person who assigned the task and is never pushed downward with the authority.

Question 6Business Organization and Management

In a line and staff organisation, friction between line and staff units most often arises because of which condition?

  1. Line managers are given formal authority to advise staff units
  2. Line and staff units are always merged into a single department
  3. Staff specialists advise while line managers hold decision authority Correct answer.
  4. Every staff member commands the line departments directly

Explanation

Line units carry formal decision-making authority along the chain of command, while staff units only advise and support. Conflict emerges because specialists often believe their expertise should prevail, yet the final decision remains with the line manager.

Question 7Business Organization and Management

A company keeps all purchasing decisions at head office even though regional offices know local suppliers better. Which outcome is most likely?

  1. Increased autonomy for regional purchasing officers
  2. Greater duplication of purchasing effort across regions
  3. A narrower span of control for the chief executive
  4. Slower decisions and less initiative in the regions Correct answer.

Explanation

Reserving decisions at head office is centralisation. It brings uniformity but delays action and discourages local initiative, because regional staff cannot use the supplier knowledge they hold, and every case must wait for approval from the centre.

Question 8Business Organization and Management

Which feature separates a cooperative society from a joint stock company?

  1. Each member has one vote regardless of capital held Correct answer.
  2. Profit is distributed strictly in proportion to the capital each member has contributed
  3. Shares are freely traded on the stock exchange
  4. The board is elected only by the largest shareholders

Explanation

A cooperative is democratically controlled, so voting rights follow membership rather than the amount of capital contributed: one member, one vote. In a cooperative, surplus is usually returned as dividend or patronage rebate, and shares are not listed for public trading.

Question 9Business Organization and Management

Under management by objectives, appraisal of a subordinate's performance is most defensible when it does which of the following?

  1. Is carried out only when the employee asks for a review
  2. Measures results against objectives set jointly with the subordinate Correct answer.
  3. Compares employees with one another rather than with agreed targets
  4. Relies mainly on the manager's overall impression of the employee

Explanation

Management by objectives builds appraisal around measurable targets that superior and subordinate agree at the start of the period, so evaluation matches actual results with those targets. Impression-based or comparative judgements lack the objectivity that the system is designed to supply.

Question 10Business Organization and Management

A firm with several distinct product lines wants clear responsibility for the profit earned by each product. Which structure best suits this aim?

  1. A line structure with no staff advisory units
  2. A divisional structure built around each product line Correct answer.
  3. A purely functional structure built around specialised departments
  4. A flat structure with no middle management layer

Explanation

When product lines differ, grouping activities into divisions, each with its own production, sales and support functions, fixes accountability for each product's performance and frees top management for strategy. A single functional grouping spreads several products across shared departments, so product profit is hard to attribute.

Question 11Business Organization and Management

Which of the following best describes management?

  1. recording every daily cash transaction of the enterprise
  2. producing goods with the help of modern machinery
  3. selling products to customers at a competitive price
  4. achieving goals through other people Correct answer.

Explanation

Management is the process of planning, organising, staffing, directing and controlling the work of others so that stated goals are attained. Its distinguishing feature is that results are achieved through people rather than by the manager working alone; cash recording, selling and production are operating functions, not management itself.

Question 12Business Organization and Management

Why is planning regarded as the primary function of management?

  1. It eliminates every risk that a business may face in future
  2. It guarantees that the firm will earn a profit every year
  3. It is carried out only by the owners of the enterprise
  4. It supplies the goals on which later functions rest Correct answer.

Explanation

Planning comes first in the management cycle because it fixes the objectives, policies and programmes that organising, staffing, directing and controlling then serve. Without a plan the other functions have no target to work towards. Planning can reduce uncertainty, but it can neither abolish risk nor promise a profit.

Question 13Business Organization and Management

Which feature is found in every form of business enterprise?

  1. Separation of ownership from management
  2. Limited liability of every investor
  3. Risk bearing by the entrepreneur Correct answer.
  4. Compulsory registration with a government office

Explanation

Whatever its legal form, a business invests capital in anticipation of profit and therefore carries the risk of loss arising from uncertainty in the market. Limited liability, compulsory registration and the separation of ownership from management appear only in particular forms, chiefly joint stock companies.

Question 14Business Organization and Management

A partner contributes capital and shares profit and loss, but takes no part in the daily management of the firm and is not publicly known as a partner. Such a partner is called a

  1. partner by estoppel
  2. nominal partner
  3. dormant partner Correct answer.
  4. minor partner

Explanation

A dormant partner, also called a sleeping partner, invests capital and shares profit and loss while staying out of day-to-day management and out of public view. The firm remains bound by such a partner's capital contribution and profit share even though the person takes no active part in running it.

Question 15Business Organization and Management

Which statement correctly describes a statutory corporation?

  1. It is formed by registering a deed with the registrar of firms
  2. It is set up by a special Act of the legislature Correct answer.
  3. It is owned and managed by a group of private investors
  4. Its shares are freely traded on the stock exchange

Explanation

A statutory or public corporation is created by a special Act of the legislature, which lays down its objects, powers and functions. It is a body corporate with perpetual succession, is owned and financed by the government, and its shares are not listed for trading on a stock exchange.

Question 16Business Organization and Management

A partnership firm was never registered, and it now wishes to sue a customer for unpaid dues. What is the effect of non-registration on the firm's legal position?

  1. It must be converted into a joint stock company
  2. The firm is automatically dissolved by law
  3. It cannot enforce its rights by a suit in court Correct answer.
  4. Its contracts with third parties become void

Explanation

An unregistered firm is barred from bringing a suit to enforce a contractual right against a third party, although it may itself be sued and its partners remain personally liable. Registration is not compulsory, so the firm is not dissolved and its contracts with outsiders remain valid.

Question 17Business Organization and Management

Thirty people wish to form a company whose shares cannot be offered to the general public and can be transferred only with the consent of the members. Which form suits them?

  1. A statutory corporation created by a special Act
  2. A public limited company listed on the stock exchange
  3. A cooperative society of local retailers
  4. A private limited company Correct answer.

Explanation

A private limited company suits a small closed group because its articles restrict the transfer of shares and it is forbidden to invite the public to subscribe for its securities. A public company raises capital from the public, a statutory corporation needs a special law, and a cooperative is organised on cooperative principles for member service.

Question 18Business Organization and Management

Which document of a company defines its objects, the scope of its activities and its relationship with the outside world?

  1. The articles of association
  2. The prospectus issued to the public
  3. The certificate of incorporation
  4. The memorandum of association Correct answer.

Explanation

The memorandum of association is the company's charter: it states the name, registered office, objects, liability of members and authorised capital, and so fixes the firm's relationship with outsiders. The articles supply internal rules, the prospectus invites public subscription, and the certificate proves that the company exists.

Question 19Business Organization and Management

In a company an engineer reports both to the head of engineering and to the manager of the project on which she is currently working. Which structural feature is present, and what is its main drawback?

  1. A functional structure, which duplicates the work of specialists across departments
  2. A matrix structure, which violates unity of command Correct answer.
  3. A line and staff structure, which weakens the authority of line managers
  4. A divisional structure, which spreads profit responsibility too thinly

Explanation

When an employee is accountable both to a functional head and to a project manager, two chains of command cross, which is the defining feature of a matrix structure. It breaks the principle of unity of command, so the subordinate may receive conflicting instructions, and it also raises the cost of coordination.

Question 20Business Organization and Management

Which statement brings out the essential difference between delegation and decentralisation?

  1. Delegation is a superior-subordinate act; decentralisation is organisation-wide Correct answer.
  2. Delegation is permanent in nature, whereas decentralisation is temporary
  3. Delegation is practised in public organisations, decentralisation in private ones
  4. Delegation increases the workload of the superior, while decentralisation reduces it

Explanation

Delegation is the act of one superior handing authority to a subordinate while remaining accountable for the work, so it involves only two persons. Decentralisation is the organisation-wide dispersal of decision-making authority to lower levels and is a philosophy built out of many such acts of delegation.

Question 21Business Organization and Management

A manager interviews candidates, selects the most suitable applicant, and arranges induction training. Which management function is being performed?

  1. Planning
  2. Controlling
  3. Coordinating
  4. Staffing Correct answer.

Explanation

Staffing involves manpower planning, recruitment, selection, placement, training, and development. Selecting and inducting an employee therefore falls within staffing rather than planning or control.

Question 22Business Organization and Management

Henri Fayol argued that an employee should receive instructions from only one superior. Which principle of management does this statement describe?

  1. Esprit de corps
  2. Unity of command Correct answer.
  3. Scalar chain
  4. Unity of direction

Explanation

Unity of command means that one subordinate should report to and receive orders from one superior only, which prevents conflicting instructions. Unity of direction concerns one head and one plan for a group of activities with the same objective.

Question 23Business Organization and Management

A company states that it will give preference to local suppliers whenever quality and price are comparable. This statement is best classified as which type of plan?

  1. A policy Correct answer.
  2. A programme
  3. A procedure
  4. A budget

Explanation

A policy is a general standing guideline that governs repeated decisions within set limits. A programme and a budget are single-use plans, while a procedure prescribes a specific sequence of steps rather than a broad guideline.

Question 24Business Organization and Management

In a large company, the marketing manager receives the annual sales target from the board and converts it into monthly targets for each regional sales team. Which level of management is the marketing manager performing?

  1. Operational management
  2. Top management
  3. Supervisory management
  4. Middle management Correct answer.

Explanation

Middle management interprets top-level strategy and translates it into departmental or divisional targets that lower levels can implement. Top management sets overall strategy, while supervisory management directly oversees operative employees.

Question 25Business Organization and Management

Which advantage is most closely associated with a pure line organisation structure?

  1. Specialist advice at each level
  2. Flexible dual reporting links
  3. Product-wise profit responsibility
  4. Clear authority, quick decisions Correct answer.

Explanation

In a line organisation, authority flows vertically from superior to subordinate, so responsibility is clear and decisions can be made quickly. Specialist advice belongs to line and staff, dual reporting to a matrix, and product profit accountability to a divisional structure.

Question 26Business Organization and Management

In the control process, what should a manager do immediately after measuring actual performance?

  1. Establish the standards to be used
  2. Compare actual performance with standards Correct answer.
  3. Take corrective action
  4. Revise the organisational structure

Explanation

Control begins with standards, then measures performance, and the next step is to compare the measured results with those standards to identify deviations. Corrective action follows only after the comparison reveals a significant gap.

Question 27Business Organization and Management

A team leader explains a problem to the team, invites their suggestions, and then makes the final decision after considering their views. Which leadership style is being used?

  1. Bureaucratic
  2. Autocratic
  3. Laissez-faire
  4. Democratic Correct answer.

Explanation

A democratic or participative leader consults subordinates and considers their input before deciding, while retaining final responsibility. Autocratic leaders decide alone, laissez-faire leaders give the group freedom, and bureaucratic leaders rely on rules.

Question 28Business Organization and Management

A firm deliberately keeps the number of subordinates reporting to each manager small at every level. Which outcome is most likely?

  1. Wider use of dual reporting
  2. Faster top-to-bottom communication
  3. A tall, multi-level structure Correct answer.
  4. A flat structure with few levels

Explanation

A narrow span of control means each manager supervises few subordinates, so more levels are needed to cover the same workforce, producing a tall structure. A flat structure arises from wide spans, and tall structures tend to slow communication.

Question 29Business Organization and Management

A sales manager reviews only those expense reports that differ from the budget by more than 5 per cent and ignores the rest. Which control principle is being applied?

  1. Unity of direction
  2. Management by objectives
  3. Span of control
  4. Management by exception Correct answer.

Explanation

Management by exception directs managerial attention to significant deviations from standards while routine, acceptable results are left alone. Management by objectives is a goal-setting and appraisal system, span of control concerns the number of subordinates, and unity of direction concerns one plan for one objective.

Question 30Business Organization and Management

What is normally the first step in the organising process?

  1. Assigning duties to staff
  2. Establishing reporting lines
  3. Dividing the work Correct answer.
  4. Delegating authority

Explanation

Organising begins with identifying the work to be done and dividing it into manageable tasks, which then allows grouping, assignment, and delegation. Reporting relationships and delegation come after the work has been classified.

Question 31Business Organization and Management

Which level of management spends most of its time on setting objectives and framing policies rather than on supervising daily work?

  1. Top-level management Correct answer.
  2. Workers' committee
  3. Middle-level management
  4. Supervisory management

Explanation

Top-level management consists of the board of directors and senior executives. It sets the vision, objectives and broad policies of the enterprise and spends relatively little time on routine supervision, which is left to middle and lower levels.

Question 32Business Organization and Management

In a co-operative society, voting rights are distributed on which basis?

  1. The volume of business a member transacts with the society
  2. The number of shares held by each member
  3. The amount of capital contributed by each member
  4. The principle of one member, one vote Correct answer.

Explanation

A co-operative society is based on the principle of democratic control. Each member has one vote regardless of the number of shares held or the capital contributed, so control cannot be bought by a few wealthy members.

Question 33Business Organization and Management

A trader runs a grocery shop as a sole proprietor. Which statement best describes his liability for the debts of the business?

  1. He is liable only to the extent of business assets
  2. His personal assets may be used to clear business debts Correct answer.
  3. His liability is limited to the capital he has invested
  4. His liability is shared equally with his family members

Explanation

A sole proprietorship is not a separate legal entity from its owner. The proprietor is personally liable without limit for business debts, so creditors may proceed against his personal assets as well as the assets of the business.

Question 34Business Organization and Management

Under Taylor's differential piece-rate system, a worker who produces above the standard output receives what for that output?

  1. A fixed daily wage in place of any piece rate
  2. A lower rate per piece to discourage overproduction
  3. A higher rate per piece for the entire quantity produced Correct answer.
  4. The same rate per piece as a worker who meets the standard

Explanation

Taylor's differential piece-rate system pays a low rate for output below standard and a high rate, applied to all the pieces, for output at or above standard. This creates a strong incentive to raise output while penalising inefficiency.

Question 35Business Organization and Management

According to Fayol's scalar chain, what does the 'gang plank' permit?

  1. Consultation between a manager and an outside trade union leader
  2. Direct contact between equal-ranking managers, with superiors' consent Correct answer.
  3. Transmission of orders strictly downward through every level of the chain
  4. A subordinate sending a report directly to the managing director

Explanation

The scalar chain is the formal line of authority running from the top to the bottom of the organisation. Fayol's gang plank allows two employees at the same level to communicate directly when speed is essential, provided their immediate superiors approve, so that delay is avoided.

Question 36Business Organization and Management

In a line-and-staff organisation, a production manager is advised by a quality-control manager. What is the nature of the quality-control manager's authority?

  1. Staff authority to advise and assist the production manager Correct answer.
  2. Unlimited authority over every department in the organisation
  3. Line authority to issue orders directly to production workers
  4. No authority of any kind within the organisation

Explanation

Staff positions exist to advise, advise and help line managers. The quality-control manager may recommend standards and techniques but cannot command production workers, because command authority over those workers rests with the line manager.

Question 37Business Organization and Management

A worker has a permanent job and a pension and now seeks membership of a workplace social club and close friendships with colleagues. Which need is he trying to satisfy?

  1. Social need Correct answer.
  2. Safety need
  3. Self-actualisation need
  4. Physiological need

Explanation

Maslow arranged human needs in a hierarchy: physiological, safety, social, esteem and self-actualisation. Permanent employment and a pension satisfy safety needs, so the next unmet need is the social need for belonging, friendship and group membership.

Question 38Business Organization and Management

A firm lays down the fixed sequence of steps, from advertisement to appointment, to be followed in recruiting an employee. This is an example of:

  1. a policy
  2. a rule
  3. a method
  4. a procedure Correct answer.

Explanation

A procedure is a prescribed chronological sequence of steps for carrying out a recurring activity. It tells employees how a task is to be performed from beginning to end, whereas policies give general guidelines and rules prescribe specific do's and don'ts.

Question 39Business Organization and Management

Karim, who is not a partner, allows his name to appear on the firm's letterhead and so leads suppliers to believe he is a partner. A supplier who dealt with the firm relying on this belief now finds Karim denying liability. Karim is:

  1. liable only if the partnership firm is registered
  2. liable only up to the capital he actually contributed
  3. liable as a partner by holding out Correct answer.
  4. not liable because he never signed the partnership deed

Explanation

The doctrine of holding out makes a person who, by words or conduct, leads others to believe that he is a partner liable as a partner to those who deal with the firm on that belief. This happens even though he never signed the deed or shared in the profits.

Question 40Business Organization and Management

A director uses company funds for personal luxury and leaves creditors unpaid, and the court decides to disregard the company's separate personality. This is an example of:

  1. the doctrine of constructive notice
  2. the principle of limited liability
  3. lifting the corporate veil Correct answer.
  4. the doctrine of ultra vires

Explanation

A company is a separate legal person, but courts may disregard that separation where it is used as a cloak for fraud or improper conduct. Diverting company funds for personal gain and leaving creditors unpaid is a standard ground for lifting the corporate veil.

Question 41Accounting and Bookkeeping

A business has total assets of Tk 850,000 and total liabilities of Tk 320,000. Using the accounting equation, what is the amount of owner's equity?

  1. Tk 530,000 Correct answer.
  2. Tk 1,170,000
  3. Tk 850,000
  4. Tk 320,000

Explanation

The accounting equation states that assets equal liabilities plus owner's equity, so equity is found by subtracting liabilities from assets. Here Tk 850,000 minus Tk 320,000 gives Tk 530,000, which represents the owner's residual claim on the business.

Question 42Accounting and Bookkeeping

Under the double-entry system, an increase in an asset is recorded as:

  1. a credit entry in the asset account
  2. a debit entry in the capital account
  3. a debit entry in the asset account Correct answer.
  4. a credit entry in the liability account

Explanation

Assets carry debit balances, so any increase in an asset is entered on the debit side of that asset account. Every such debit must be matched by an equal credit elsewhere, which keeps the accounting equation in balance.

Question 43Accounting and Bookkeeping

Goods sold on credit to a customer are first recorded in the:

  1. cash book
  2. sales journal Correct answer.
  3. petty cash book
  4. purchases journal

Explanation

The sales journal, also called the sales day book, is the book of original entry for credit sales of goods. Each entry is later posted to the individual customer's account in the sales ledger and to the sales account in the general ledger.

Question 44Accounting and Bookkeeping

Which of the following errors would still allow the trial balance to agree?

  1. A cheque of Tk 2,500 received from a customer was entered in the cash book but not posted to the customer's account
  2. A credit sale of Tk 9,000 was posted to the sales account but not to the customer's account
  3. A repair bill of Tk 3,000 was debited to the building account instead of the repairs account Correct answer.
  4. The debit column of the trial balance was added up incorrectly

Explanation

An error of principle occurs when a transaction is entered in the wrong class of account but with equal debits and credits, so the two sides of the trial balance remain equal. Debiting a revenue repair to the building asset account is such an error, and only an examination of the ledger records will reveal it.

Question 45Accounting and Bookkeeping

A firm's cash book shows a debit balance of Tk 42,000. Cheques totalling Tk 7,500 issued to suppliers have not yet been presented at the bank. What balance will appear on the bank statement?

  1. Tk 34,500 credit
  2. Tk 42,000 credit
  3. Tk 57,000 credit
  4. Tk 49,500 credit Correct answer.

Explanation

Unpresented cheques have been deducted in the cash book but not yet in the bank's records, so the bank statement still shows a higher balance. Adding the Tk 7,500 to the cash book balance of Tk 42,000 gives a bank statement balance of Tk 49,500.

Question 46Accounting and Bookkeeping

A machine costing Tk 250,000 has an estimated scrap value of Tk 10,000 and a useful life of 8 years. Using the straight-line method, what is the annual depreciation charge?

  1. Tk 30,000 Correct answer.
  2. Tk 31,250
  3. Tk 25,000
  4. Tk 12,500

Explanation

Under the straight-line method the depreciable amount, which is cost less scrap value, is spread evenly over the useful life. Tk 250,000 minus Tk 10,000 leaves Tk 240,000, and dividing this by 8 years gives Tk 30,000 per year.

Question 47Accounting and Bookkeeping

A petty cashier works on an imprest of Tk 5,000 and holds vouchers totalling Tk 3,600 at the end of the month. Under the imprest system, how much will she receive to restore the float?

  1. Tk 3,600 Correct answer.
  2. Tk 8,600
  3. Tk 1,400
  4. Tk 5,000

Explanation

Under the imprest system the petty cashier is reimbursed exactly the amount spent, which is proved by the vouchers, so the float returns to its original level. Vouchers of Tk 3,600 mean Tk 3,600 has been paid out, and that is the sum needed to restore the Tk 5,000 imprest.

Question 48Accounting and Bookkeeping

Which of the following is treated as capital expenditure?

  1. Yearly insurance of the delivery van
  2. Replacement of a broken window
  3. Erection cost of a new machine Correct answer.
  4. Rent paid for the warehouse

Explanation

Capital expenditure is spending incurred to acquire, install or improve a non-current asset, because the benefit lasts beyond one accounting period. The cost of erecting a new machine is necessary to bring the asset into working condition, so it is added to the cost of the machine.

Question 49Accounting and Bookkeeping

A credit purchase of Tk 6,400 was entered in the purchases account as Tk 4,600, while the supplier's account was correctly credited. What entry in the suspense account will correct this?

  1. Credit Tk 11,000
  2. Debit Tk 1,800 Correct answer.
  3. Debit Tk 6,400
  4. Credit Tk 1,800

Explanation

The purchases account was debited with Tk 1,800 less than it should have been, leaving total debits short of total credits by Tk 1,800. The suspense account must therefore be debited with Tk 1,800 so that the trial balance agrees while the error is being corrected.

Question 50Accounting and Bookkeeping

At the year end a firm has receivables of Tk 120,000. It writes off Tk 4,000 as irrecoverable and then creates a provision for doubtful debts at 5% of the remaining receivables. What is the amount of the provision?

  1. Tk 6,000
  2. Tk 5,600
  3. Tk 4,000
  4. Tk 5,800 Correct answer.

Explanation

The bad debt must be removed from receivables before the provision is calculated, because the provision applies only to debts still considered collectable. The remaining Tk 116,000 multiplied by 5% gives a provision of Tk 5,800.