Interested to Buy Any Domain ? << Click Here >> for more details...
How to treat the provision for bad debts which appeared on
the credit side of the P&L A/c?
- 3 Answers
- 14818 Views
- Wipro, I also Faced
- E-Mail Answers
Answer Posted / krishna
This is an Income. Bad debts provision will be kept aside
from the Profits of the company.If this was not utilised in
the previous year, then this will be carried forward to
next year. In the present year if the Provision required is
lesser than the last year provision, then the difference
will be posted on the credit side of the profit and loss
account.
Ex: Last Year provision 1000
This year provision required 900
Then the Journal entries are as follows
Bad Debts A/c Dr 900
To Bad debts provision A/c 900
Effect on the P&L Account:
900 - on the Debit side of the P&L (New Provision)
1000 - on the Credit side of the P&L (Old Provision)
Net effect - 100 (P&L Credit)
Treatment in B/s
Reduce the Debtors by 900 (Deduct New Provison only as the
difference has been already taken back to P&L)
| Is This Answer Correct ? | 4 Yes | 0 No |
Post New Answer View All Answers
Deposited Rs 25000 in Canara Bank of ABC co towards dealership deposit thru our SBH Bank Pass necessary entry
Expand---------EDP
how to work on CMA form in manufacturing compay as well as how to analysis working capital ?
what is transposition-cum-demat?
What's the meaning of Preferential Creditor?
what is mean by ledger
Pls Give me Solution for me. Bcz i m persuing b.a iii But now i m working in accounts . So what i do In future .
hi.this krishan .i m slect in axis bank for executive. when i sposse to join
what do you mean indirect expanse in trading business?
Please share different type of Z report
how to mention last year profit of ay private limited company in current year balance sheet ?
What is a bad credit score?
Expand-------ATBN
Q5 Prepare a Balance sheet from the following particulars: Gross profit =Rs.80,000 Gross profit to cost of goods sold =1/3 Stock velocity =6 times Opening stock =Rs.36,000 Accounts receivable velocity =72 days (year=360 days) Current assets=Rs.1,50,000 Account payable velocity=90 days Bills receivable =Rs.20,000 Bills payable=Rs.5,000 Fixed assets turnover ratio (on cost of goods sod)=8 times
what are the steps used in UAT in Oracle Apps?
