Accountancy Forum - Bed Debt and Provision.

Deat All.

I WANT TO KNOW ABOUT SOME THING IN RESPECT OF SUBJECT MATTER.

if we have an opening blnc

- in provision for bed debts account Rs. 17,000/-

and this year bed debts write off Rs, 15,000/- also pls notify that the closing debtors is Rs 600,000/-
and a provisioning is required @5% on closing debtors.

MY QUES IS THAT ;

- some teachers says that charge the difference amount of Prov.BED DEBT Account in Bed debt expence account( instead of directly charged in P/L Account) and the total amount of bed debts account
write off debtors + prov. difference should be reported in P/L Account.

- Some Teacher says that Charge bed debt expence in provision account ( instead of directly charging in P/L ACCOUNT) in case of provisioning has not maintain first time.

so, please provide that what is the correct process in above two cases.

Regard

Umar

Pleaes rephrase the two suggested method, i cant understand the query.!

<blockquote id="quote">quote<hr height="1" noshade id="quote">Originally posted by Star
 Pleaes rephrase the two suggested method, i cant understand the query.!
<hr height="1" noshade id="quote"></blockquote id="quote">

Dear Friend.

I asked that what should we have to do in respect of passing the genral entry for adjustment of provision for bed debt account.
let suppose that; if there is an opening blnc in provision account is RS 20,000 / and this year provision is being maintain 5 % on closing blnc of debtors which is Rs, 600,000/ after write-off bed debts.

Meance, this is closing blnc of provision account is Rs. 30,000/-.

My question is that

1) should we charge the provision directly into P/L ACCOUNT by
Passing the below General entry.

P/L ACCOUNT DR 10,000
Prov. for bed debt Cr 10,000

2) should we adjust this prov. balance by passing the below general
entry.

Bed Debt Expence DR 10,000
Prov. for bed debt CR 10,000

What is the best rout to adjust this provision blnce in both above cases.

Regard

UMAR.

Yar there is no difference between the two entries mentioned by you in one entry you are mentioning specific head of expense that is bad debt and in other you are gernally debiting Pl dono mein kuch bhe fark nahen dont get confused...
<blockquote id="quote">quote<hr height="1" noshade id="quote">Originally posted by umar_khi08@yahoo.com
 <blockquote id="quote">quote<hr height="1" noshade id="quote">Originally posted by Star
 Pleaes rephrase the two suggested method, i cant understand the query.!
<hr height="1" noshade id="quote"></blockquote id="quote">

Dear Friend.

I asked that what should we have to do in respect of passing the genral entry for adjustment of provision for bed debt account.
let suppose that; if there is an opening blnc in provision account is RS 20,000 / and this year provision is being maintain 5 % on closing blnc of debtors which is Rs, 600,000/ after write-off bed debts.

Meance, this is closing blnc of provision account is Rs. 30,000/-.

My question is that

1) should we charge the provision directly into P/L ACCOUNT by
Passing the below General entry.

P/L ACCOUNT DR 10,000
Prov. for bed debt Cr 10,000

2) should we adjust this prov. balance by passing the below general
entry.

Bed Debt Expence DR 10,000
Prov. for bed debt CR 10,000

What is the best rout to adjust this provision blnce in both above cases.

Regard

UMAR.

<hr height="1" noshade id="quote"></blockquote id="quote">

<blockquote id="quote">quote<hr height="1" noshade id="quote">Originally posted by imdad1
 Yar there is no difference between the two entries mentioned by you in one entry you are mentioning specific head of expense that is bad debt and in other you are gernally debiting Pl dono mein kuch bhe fark nahen dont get confused...
<blockquote id="quote">quote<hr height="1" noshade id="quote">Originally posted by umar_khi08@yahoo.com
 <blockquote id="quote">quote<hr height="1" noshade id="quote">Originally posted by Star
 Pleaes rephrase the two suggested method, i cant understand the query.!
<hr height="1" noshade id="quote"></blockquote id="quote">

Dear Friend.

I asked that what should we have to do in respect of passing the genral entry for adjustment of provision for bed debt account.
let suppose that; if there is an opening blnc in provision account is RS 20,000 / and this year provision is being maintain 5 % on closing blnc of debtors which is Rs, 600,000/ after write-off bed debts.

Meance, this is closing blnc of provision account is Rs. 30,000/-.

My question is that

1) should we charge the provision directly into P/L ACCOUNT by
Passing the below General entry.

P/L ACCOUNT DR 10,000
Prov. for bed debt Cr 10,000

2) should we adjust this prov. balance by passing the below general
entry.

Bed Debt Expence DR 10,000
Prov. for bed debt CR 10,000

What is the best rout to adjust this provision blnce in both above cases.

Regard

UMAR.

<hr height="1" noshade id="quote"></blockquote id="quote">
<hr height="1" noshade id="quote"></blockquote id="quote">

My Dear Imdad Sb.

I am not asking about difference. i am just asking that what is the best route??

Some teacher sys that charge prov. directly into P/l, and some teacher sys that charge prov. throug bed debt expense account.

There is no doubt of any difference becoz net impect is equal in both cases but why some teacher choise different approach. what is the reason??