ranjini

 

under Provisions

regards

Debt forgiveness is an excellent thing for most people, as it means less than the complete of a debt has been compensated though the debt has been satisfied. However, it's regarded as taxable income and the lapse of a debt forgiveness tax break for foreclosures or short sales of homes is set to bite some working class individuals. Resource for this article: why not really check out soon some of our website?

Consider we have made provision for doubtfull debts for rs.100000 & in next year we receive 70000 as full & final payment what are the entries in current year books as well as previous year books?

Dear sir,

I want Reserve for Bad and Doubtful Debts and provision for doubtful depts.in tally create ledger in wich under group sir 

Dear sir / mam.. 

I want small problem please explain how to treat ment in tally adjestment Provision for Bad and Doubtful Debts 

Bad Debts are actuals...

Provision for doubtful debts are estimate..

Both charged to SPL.

It is prudence concept deal in AS 4. When you assess the debtors then  you know some debtors are not considered as good, it is happen year by year. Then you made provision for such loss i.e. know as Provision for doubtfull debts. it is charged in SPL. THis is judgement so it is done on year ends..

When later year you know what exact amount of debtors did not made paymnet, then you such loss charged on provision for doubtfull debts, if amount exceed from doubtfull debt then excess amount charged in SPL. 

Provision for doubtful bad debts, Bad debts / bad debts written off, further bed debts and new provision for doubtful bad dabts and Bad dabts recover ...these Ledgers are under which group in tally ?...What is the right method to calculate Provision for bad debts? How we treat recovery of bad debts that already written off ? year back ? and how it effects in profit? which are journal entry in tally.

 

If provision is created in the old balance sheet and again in the adjustment . wat will be the treatment ?

Hello,

If you are sure that you can't further receive any amounts from a particular debtor, you treat it as bad debt and you are supposed to pass the following entry:

Bad debts a/c -------Dr

To Debtor's account

Whereas if you skeptical if particular debtor makes payments. Then you need to create a provision by passing the following entry:

Year -1:

P& L a/c ---------- Dr

 Provision for bad debts

Somewhere down the line you got to know that the particular debtor became insolvent and there is no chance recover any amount from him. Then you treat it as Bad debt and pass the following entry:

Bad debts a/c -------Dr

Provision for bad debts

Here bad debts are adjusted from already created Provision and no effect on profits.

Hope I cleared your doubts.