Joy is a sole trader and a regular customer of Sopuruchukwu Enterprises. Mr. Sopuruchukwu manages his business with his child, who recently gained admission to study Law at the University. The firm prepares its accounts to 31 December every year. On 3 April, 2017, Joy bought inventory amounting to ₦120,000 from Sopuruchukwu Enterprises. She promised to pay the invoice issued to her for the transaction on 1 May 2017. On 2 May, Joy travelled abroad. As at 31 December 2019, Sopuruchukwu Enterprises' efforts to reach the family of Joy proved abortive. Mr. Sopuruchukwu did not adequately verify Joy's shop's location because he assumed that Joy had never defaulted in making timely payments for goods sold to her. It is the policy of Sopuruchukwu Enterprises to write off debts for more than one year.
Required:
i. Advise the seller on what to do to prevent overstatement of the net assets of his business.
ii. In Sopuruchukwu Enterprises' books, prepare the accounts to post your advice to the seller. Assume that joy is the only customer of Sopuruchukwu Enterprises.
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