Question

Why provision for doubtful is treated in the financial statement and why is having credit balance in the trial balance and bad debt having debit balance

Answer 1

Answer:

Provisions Of Bad Debts Is A Amount Which Is Treated Like A Liability Which Is A Reserve Fund Of Losing Amount From Debtor. So Its Have A Credit Nature If It's Increases.

Bad Debts Is Clear Expense Which Is Treated Like A Loss By Debtors So It's Have A Debit Nature If It Increases.

Hope You Get The Point Now.