Answer Posted / ammu

provision are made because they are payable in future not
or next accounting year.

JOURNAL ENTRY

company pay gratuity and each year an entry is pass for the
same which is called Provision for gratuity

so entry will be

Gratuity A/c dr
Provision for Gratuity a/c

this is a provision entry ( above )

Profit & loss a/c DR
Gratuity A/c

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