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Querist : Anonymous

Querist : Anonymous (Querist)

24 August 2011 sir, why is P/l a/c is debited in the entry for provision for bad debts??

i.e P/l a/c dr.
To,provision for bad debts A/c..

Also what do we mean by write off. or written off.

also sir, is this entry correct when bad debts are recovered??

Cash a/c dr.
to bad debts recovery a/c..

CA Ashwani Agarwal

CA Ashwani Agarwal (Expert)

24 August 2011 Provision for bad debts is an expense which is created by debiting the P & L A/c as it is not a real expense but a provisional expense only and provisions are created through P & L A/c.

Write off means cancelling a debt. When you pass the entry of
Bad Debts Dr.
To Debtor
then you are cancelling a Debt which is also known as write off.

Message likes : 1 times

CA Ashwani Agarwal

CA Ashwani Agarwal (Expert)

24 August 2011 Yes, your entry for Bad Debts recovery is correct.

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