At the end of the year, a bad debt recovered is treated as:
Loss of the year
Profit of the year
Expense
Income of the year
What do we do with provision for bad debts in balance sheet?
Added to debtors account
Deducted from debtors account
Added to creditors account
Deducted from creditors account
Where will be the difference between provision for bad debts posted?
Profit and loss account
Balance sheet
Journal
Ledger
The establishing of a credit limit and the later monitoring of the debtors account is known as:
Credit limit
Credit
Credit control
Over credit
At the end of the year, bad debts recovered account is transferred to the bad debts account. This will be:
Reduces the bad debts written off during the year
Not affect at all
Increases the profit
Estimate of the amount which a business will lose in a financial year because of bad debts is known as:
Provision for bad debts
Bad debts
Written off debts
A bad debt is:
Profit
Loss
Expenditure
Gain
The amount of bad debts is:
Income
Writing off bad debts is an example of:
Materiality principle
Consistency principle
Prudence principle
Disclosure principle
Where will the debts be posted in profit and loss account?
Not recorded
Debit
In the loss side
