A debtor who dues 5000 were written off as bad debts paid 4000 in full settlement . Show working in revaluation acount
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Answer:
(a) Cash A/c. Dr 4000
To bad debt recovered A/c 4000
(b)bad debt recovered A/c Dr 4000
To revaluation A/c 4000
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We need to show the workings of bad debts paid in the revaluation account.
- The revaluation account needs to be credited with the amount of Rs as this amount was already written off as bad debt
- The company has already written off the ' amount of Rs. 'as bad debts.
- Now the company is getting back some of the money which was written off.
- So now the revaluation account has to be credited with the amount of Rs.
- So the journal entry will be
Bad debts recovered a/c
To, Revaluation a/c
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