Question

A debtor who dues 5000 were written off as bad debts paid 4000 in full settlement . Show working in revaluation acount

Answer 1

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

Answer 2

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 $4000$ as this amount was already written off as bad debt

•  The company has already written off the ' amount of Rs.$5000$ '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. $4000$
• So the journal entry will be

                       Bad debts recovered a/c $4,000$  

                 To, Revaluation a/c                               $4,000$