Help to clear my doubts......in partnership

IPCC 914 views 2 replies

Harish Kumar

IPCC

475 Points Joined June 2012

What are the difference in these two point & Why we treat differently in Revaluation A/C (in partnership question)

1) The Provision for bad debts was found to be in excess by Rs. 400

2) Provision for doutful debts to be increased by RS. 400

Sol:- First one take Cr. Side of Revaluation A/C (because of decrease in liability) & 2nd is taken on Dr. Side of Revaluation A/c (because of increase in liability )

my question is here both the two points are the same (1. ecxcess by rs. 400....2. increased by 400) then why we treat differently in revaluation A/C why we not take both of the points in Dr. side of Revaluation A/C (both the points are increasing doutful debts)

Please explain in detail............

Thank you

Replies (2)

Anand Luhar

Entrepreneur(CA/CWA Gold Medal)

254 Points Joined February 2009

ur answr in ur ques 1 already you debited once at some time ago while 2nd is fresh entry an current soo all due to time difference 1st you have already debited which means you have shown loss while this was not loss so cr in revaution ac which one type of p&l ac

Yogesh Bhandari

CA FINAL Student

429 Points Joined July 2011

might be you interpret the question differently

1) Provision for bad debts was found to be in excess by Rs. 400 - that means you have to revalue it for decresing because you made excess provision previously.

2) Provision for doutful debts to be increased by RS. 400 - that means you have to revalue it for incresing because you made short provision previously.

Since, the accounting entry for both should be revealed differently.

1) The Provision for bad debts was found to be in excess by Rs. 400 2) Provision for doutful debts to be increased by RS. 400

Read more at: /forum/help-to-clear-my-doubts-in-partnership-229281.asp#.ULfUdVIqrC8

1) The Provision for bad debts was found to be in excess by Rs. 400 2) Provision for doutful debts to be increased by RS. 400

Read more at: /forum/help-to-clear-my-doubts-in-partnership-229281.as