Diwakar Mishra (Accountant) (136 Points)
23 October 2011Sundry debtors are Rs. 100000 as at 31.03.11. Recovery of Rs. 10000 is doubtful and management decided to make provision against that. Amount Rs. 95000 received in next year on 05.05.11 from that debtor.
Please pass the entry on 31 march 2011 and 05.05.11
CA Sachin Rastogi
(Audit/IFRS Manager)
(338 Points)
Replied 23 October 2011
On 31 March you can record 10K as provision against a gross receivable of 100K. For balance sheet presentation u will net the provision against the gross receivable.
On 5 May you can record the receipt by debiting bank with 95K , debiting provision by 5K and credit gross receivables by 100K. The residual provision of 5K will be released to the income statement as reversal of excess provision as it is no longer required.
Diwakar Mishra
(Accountant)
(136 Points)
Replied 23 October 2011
Provision for Doubtul Debts..............Dr. 10,000
To Sundry Debtors.................................................10,000
Provision for doubtfull debts Rs. 10,000 charged to profit and loss account on 31.03.11.
Is i am wroung ?
Rahul Suneja
(CA-Final, CS-Exec)
(215 Points)
Replied 23 October 2011
on 31.311
P&L a/c dr. 10000
To prov. for doubtful debts10000
and this amt will be deducted from closing sundry debtors
on 5.5.11 5000 bad debts will be written off from prov for doubtful debts
Prov for doubtful debts a/c dr. 5000
To bad debts a/c 5000
and in the end of the year 5000 will be credited to P&L a/c as excess provision made
rakesh ostwal
(CA)
(23 Points)
Replied 01 November 2011
rahul answer with with more clearification
on 5-05-2011
entry at the time of receipt will be
Cash A/c dr 95000
to debtors A/c 95000
and
Provision for DD dr 5000
To P & L A/c 5000
Bhaskar Unnikrishnan CPA CMA
(Accounts / Administration)
(414 Points)
Replied 02 November 2011
| Originally posted by : Rahul Suneja | ||
 |
on 31.311 P&L a/c dr. 10000 To prov. for doubtful debts10000 and this amt will be deducted from closing sundry debtors on 5.5.11 5000 bad debts will be written off from prov for doubtful debts Prov for doubtful debts a/c dr. 5000 To bad debts a/c 5000 and in the end of the year 5000 will be credited to P&L a/c as excess provision made |
 |
Hemanth Sai
(CA-FINAL,AUDIT TRAINEE)
(110 Points)
Replied 02 November 2011
on 31.3.11
P&L a/c dr. 10000
To prov. for doubtful debts 10000
and this amt will be shown reduced from the closing sundry debtors balance rather than showing it in the provisions in liabilities side.
on 5.5.11 5000 bad debts will be written off from prov for doubtful debts
1)Prov for doubtful debts a/c dr. 5000
To bad debts a/c 5000
2) Bad debts a/c 5000
To sundry Debtors 5000
3)Prov for doubtful debts a/c dr. 5000
To P&L a/c 5000
and in the end of the year 5000 will be credited to P&L a/c as excess provision made
and diwakar u cannot do
"
Provision for Doubtul Debts..............Dr. 10,000
To Sundry Debtors.................................................10,000 "
in this way because its just a prov ,if it is bad debt u can write-off it directly from debtors balance and show it in the p&l. so u need to just create the provision andshow the expense(loosing the receivables) in the p&l by pasing the entry as
P&L a/c dr. 10000
To prov. for doubtful debts 10000
.
CAclubindia
