05-25-2005, 06:38 PM
hi...i need to ask one thing abt provisions..
there are two methods of doing questions..
1- we open separate accounts for "provision of doubtful debts" and for "bad debts".......we transfer the balance from both to P&L separately.
2-we open account for "prov. for doubt.. debts".....we transfer the bad debts to this account and then transfer the balance to P&L....
i have seen both the methods ..and in frankwood only the first method is mentioned.........but when i see solved past papers...in all those the second method has been used.....my cousin in mod.E also told me that second method is better...
what do u guyz suggest?? is the first one ok or not?
there are two methods of doing questions..
1- we open separate accounts for "provision of doubtful debts" and for "bad debts".......we transfer the balance from both to P&L separately.
2-we open account for "prov. for doubt.. debts".....we transfer the bad debts to this account and then transfer the balance to P&L....
i have seen both the methods ..and in frankwood only the first method is mentioned.........but when i see solved past papers...in all those the second method has been used.....my cousin in mod.E also told me that second method is better...
what do u guyz suggest?? is the first one ok or not?
