Question

Rs.1,500 received from Bahadur whose
account was previously written off as
bed-debt should be credited to
Bahadur's A/C
O
Bad-debts Recovered A/C
Suspense A/C
Cash A/C​

Answer 1

Answer:

bad debts recovered a/c

Answer 2

The account will be Bad dues recovered A/c.

• The journal entry when Bahadur was treated as bad dues will be -  

Bad dues a/c Dr. 1500

To Bahadur’s a/c 1500

( Being amount due from Bahadur is found unrecoverable)

• Journal entry when money is recovered which was written down previously will be -

Cash a/c Dr 1500

To bad dues recovery a/c 1500

( Being amount due from Bahadur recovered)

• In the first entry, bad dues were viewed as a loss but since later they were recovered, thus are credited as a gain