Question

Define the term provision for doubtful debts with accounting treatment

Answer 1

always there is an uncertainty of bad debts
to avoid miscalculation and shortage of funds, a provision for doubtful debts is allotted
if therein any bad debts arises it will be used up from the provision.
it is provided on a certain percentage on debtors.
it is shown in debit side of p & l
deduced from debtors

Answer 2

The provision for bad debts could refer to the balance sheet account also known as the Allowance for Bad Debts, Allowance for Doubtful Accounts, or Allowance for Uncollectible Accounts. ... The entry to increase the credit balance in these contra accounts is a debit to the income statement account Bad Debts Expense.