Question

recovery of bad debt is treated as deemed profit​

Answer 1

Answer:

Bad recovery is payment recieved for a debt that was written off and considered uncollectable.The receivable may come in the form of a lone, credit line, or any other accounts receivable.

Because it generally generated a loss when it is written off , bad debt recovery usually produces income.In accounting the bad debt recovery credits the allowance for bad debt or bad debt reserve categories and reduce the account receivable category in the book.