Accounts??
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
24 August 2011
sir, why is P/l a/c is debited in the entry for provision for bad debts??
i.e P/l a/c dr.
To,provision for bad debts A/c..
Also what do we mean by write off. or written off.
also sir, is this entry correct when bad debts are recovered??
Cash a/c dr.
to bad debts recovery a/c..
i.e P/l a/c dr.
To,provision for bad debts A/c..
Also what do we mean by write off. or written off.
also sir, is this entry correct when bad debts are recovered??
Cash a/c dr.
to bad debts recovery a/c..
CA Ashwani Agarwal
(Expert)
24 August 2011
Provision for bad debts is an expense which is created by debiting the P & L A/c as it is not a real expense but a provisional expense only and provisions are created through P & L A/c.
Write off means cancelling a debt. When you pass the entry of
Bad Debts Dr.
To Debtor
then you are cancelling a Debt which is also known as write off.
Write off means cancelling a debt. When you pass the entry of
Bad Debts Dr.
To Debtor
then you are cancelling a Debt which is also known as write off.
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CA Ashwani Agarwal
(Expert)
24 August 2011
Yes, your entry for Bad Debts recovery is correct.
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