HI Experts
Please confirm me in which head we should open Provision for Bad Debts .for example Bad debts opened in Indirect expenses
and in Balance sheet where we show the provision ie under Liablity or Assets
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Provision for bad debts
Replies (5)
provision for bad debts is shown under liability. In schedule VI it shown under provision.
now the question arise whether it is short term provision/long term provision it depends on the nature i.e. days,yrs etc.
if the provision made for more than one yr then shown under long term provision otherwise shown under short term provision.
| Originally posted by : Roshan Begrajka | ||
 |
provision for bad debts is shown under liability. In schedule VI it shown under provision. now the question arise whether it is short term provision/long term provision it depends on the nature i.e. days,yrs etc. if the provision made for more than one yr then shown under long term provision otherwise shown under short term provision. |
 |
| Originally posted by : Roshan Begrajka | ||
|
|
provision for bad debts is shown under liability. In schedule VI it shown under provision. now the question arise whether it is short term provision/long term provision it depends on the nature i.e. days,yrs etc. if the provision made for more than one yr then shown under long term provision otherwise shown under short term provision. |
|
CORRECT.
Current liability
| Trade receivables | ||
| Particulars | As at 31 March, 2013 | As at 31 March, 2012 |
| ` | ` | |
| Trade receivables outstanding for a period exceeding six months from the date they were due for payment # | ||
| Secured, considered good | ||
| Unsecured, considered good | ||
| Doubtful | ||
| Less: Provision for doubtful trade receivables | ||
| Other Trade receivables | ||
| Secured, considered good | ||
| Unsecured, considered good | ||
| Doubtful | ||
| Less: Provision for doubtful trade receivables | ||
| Total | ||
You cannot show in current liability, it is to be reduced from trade receivable as disclosed above.
Revised Schedule VI applies.
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