Answer / bhagya

Provision
we are creating provision for expenses which are going to
occur in future we do not konw the exact future expenses

Reserve
out of profit some protion of allotted as a reserve balance
are distribute as a dividend to shareholders
this reserve use for future business investment

Similarities between provision & reserve we are allocating
some amount ie., unknown amount (Unknown exp., or unknown
purpose of reserve creating (fe.,)we do not know the
investment amount

Answer / arun kumar

provision is the amount kept a side for future known
liabilities
reserve is an amount kept a side to face future risk occur
in the business

Answer / h.r. sreepada bhagi

As mentioned by Bhagya, accounting for expenses for a
period, the amount is not known exactly but is reasonable
estimated based on the past & showing would be liabilities
in the Balance Sheet. These provisions need to be reversed
in the subsequent accounting period and the expense shall be
accounted for exact amount, when the supporting bill is
received or the expense is ascertained with proper back-up
documents. provisioning is necessary in 'Accrual Concept' of
Accounting to match expenses with revenues in any accounting
period.
Reserve - As mentioned above is profit set aside for
specific or general Purpose. Besides this there can be
Depreciation Reserve, which represents accumulated
depreciation on Fixed Assets (This's an exception).
Provisions are part of liabilities & Reserves form part of
'Net Worth'
Provisions are shown as Provisions for Expenses under
'Current Liabilities & Provisions' & Reserves can be shown
as 'General Reserve', Dividend Equalisation Reserve',
Investment Allowance Reserve', 'Depreciation Reserve', etc,
in the 'Balance Sheet'.

Answer / k.thirumamagal

as devi said provision is charge against profit and reserves
are appropriation of profit. provision is minimum amount
which is set aside by the company to meet the known
liabilities and reserve is set aside to meet the unknown
liabilities.

Answer / devi

simply provision means which will create against the profit
and reserve means appripriation of profit

Answer / mohammed rizwan

provision means the debts which are not covered during the
accounting period.
reserve means the profit which are kept aside for future
purpose is known as reserve.

Journalise- opened a saving a/c with S.B.I. ?

0 Answers  

kindly send the TDS tariff on Security expenses, rents, transport charges etc.,

0 Answers  

What are accounting rules called?

0 Answers  

what is wct ? who take its benefit? e.g. we are works contractor, we are liable to take its benefit or not..

1 Answers  

I have received 75000/- as retainership fees from ABC company but they have deducted TDs 10% and send me 67500/- my question is that what entry i have to pass in my books please help me

5 Answers   Pharma Traders,

Q): Intangible assets(Goodwill,patents,copyright etc) how we amortise it.. this intangilble assets value can increase so till life time we should amortise these assets please guys explain me this structure?

1 Answers  

what is difference between share and equity

2 Answers  

At the time of depreciation run we selected actual dep key is 5% but we taken 7% so the depreciation was posted wrongly how to rectify it?

0 Answers   TCS,

Is it necessary after every journal entry to show its treatment in P&L a/c? Eg. if I am asked to show journal entry of purchasing furniture & fixture on 1st Aug 06, i.e. Furniture & fixture a/c Dr. To cash/bank a/c Along with this, I have to pass following journal entry on 31st Mar 07?? P&L a/c Dr. To Furniture & fixture a/c

0 Answers   WNS,

hii.. i m anura i need 30,000 urgently can i get 30,000 rps..i m doing job of accounting

0 Answers  

What Does Phantom Gain Mean?

2 Answers   CompuCom, Ernst Young,

How would the business ensure that he could not use the business cheque to pay for printing work he ordered for personal use?

1 Answers