Provision for doubtful debts

Ramya (student) (46 Points)

09 September 2013

what type of account is provision for bad and doubtful debts

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Ravikrindi Ravi Teja (student) (297 Points)
Replied 09 September 2013

Originally posted by : Ramya
	what type of account is provision for bad and doubtful debts

Valuation accounts - These are the accounts of provision for depreciation and provision for doubtful debts. Where fixed assets are maintained in the books of accounts at original cost, to reflect the actual book value of the assets, a provision for depreciation account on the credit is maintained. In the balance sheet, it is shown as deduction from the original cost of the asset. Similarly, if the debtors' personal accounts are retained at total amount due, a valuation account on the credit - provision for doubtful debts is required. In the balance sheet, it is shown as a reduction from sundry debtors account to reflect estimated realizable value.

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