provision for doubt ful debts?
Innocent Utsav (1 Points)
12 August 2019
what is the accounting entry for provision for doubtful debts and why is it posted in cr side of trial balance?
3 Replies
aditya khunteta
(2 Points)
Replied 18 August 2019
Hi Utsav,
Accounting entry for provision for doubtful debts will be;
Bad debts expense/Provision for doubtful debts Dr.
To Allowance for doubtful debts Cr.
It is a liability because the provision represents the amount that you put aside in accounts to cover a future liability. And, also as per the definition, it is a probable obligation arising out of the past events resulting into outflow of future economic benefits.
sabyasachi mukherjee
(27713 Points)
Replied 16 September 2019
Provision for doubtful debts is created as a liability upon non-realisation of money due from customer.
In case there is a bad debt .
bad debt a/c dr.
sundry debtors cr.
In case there is a bad debt .
bad debt a/c dr.
sundry debtors cr.
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