Provisional for Doubtful Debts:
You have 2 customer A & B - If A makes prompt payment on due date but B takes his own time to settle your payment & that too in makeing bits & pieces. But after some time he has stopped making Payemnt say an amount of Rs: 10,000/- due still due from 1.00 lac bill. If you make Provision for the doubtful amount (which may not likely to come) his account can be squared off by passing the entry. Otherwise his balance will shown forever.
CAclubindia
