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Which of the following statement is not true?
  • a)
    If del-credere’s commission is allowed, bad debt will not be recorded in the books of consignor
  • b)
    If del-credere’s commission is allowed, bad debt will be debited in consignment account
  • c)
    Del-credere’s commission is allowed by consignor to consignee
  • d)
    Del-credere’s commission is generally given to promote credit sales
Correct answer is 'B'. Can you explain this answer?
Most Upvoted Answer
Which of the following statement is not true?a)If del-credere’s ...
Not True Statement: If del-crederes commission is allowed, bad debt will be debited in consignment account.

Explanation:

Del-crederes commission is a type of commission given by the consignor to the consignee to promote credit sales. When del-crederes commission is allowed, the consignee undertakes the risk of bad debts. In other words, if the buyer defaults on payment, the consignee will bear the loss. The consignor pays a higher commission to the consignee for undertaking this risk.

When del-crederes commission is allowed, the bad debts will not be recorded in the books of the consignor. However, the bad debts will be debited in the books of the consignee. This is because the consignee has undertaken the risk of bad debts and it is their responsibility to bear the loss.

Therefore, the statement "If del-crederes commission is allowed, bad debt will be debited in consignment account" is not true. The bad debts will be debited in the books of the consignee and not in the consignment account of the consignor.

In summary, del-crederes commission is allowed to promote credit sales and to transfer the risk of bad debts from the consignor to the consignee. The bad debts will be recorded in the books of the consignee and not in the consignment account of the consignor.
Free Test
Community Answer
Which of the following statement is not true?a)If del-credere’s ...
When consignor give delcredere commission to consignee , bad debts should be born by consignee.

journal entry in the consignee books

Bad debts AC ... dr.
To debtors ac

commission dr.
To bad debts ac

but in consignor books there will be no entry.
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Which of the following statement is not true?a)If del-credere’s commission is allowed, bad debt will not be recorded in the books of consignorb)If del-credere’s commission is allowed, bad debt will be debited in consignment accountc)Del-credere’s commission is allowed by consignor to consigneed)Del-credere’s commission is generally given to promote credit salesCorrect answer is 'B'. Can you explain this answer?
Question Description
Which of the following statement is not true?a)If del-credere’s commission is allowed, bad debt will not be recorded in the books of consignorb)If del-credere’s commission is allowed, bad debt will be debited in consignment accountc)Del-credere’s commission is allowed by consignor to consigneed)Del-credere’s commission is generally given to promote credit salesCorrect answer is 'B'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Which of the following statement is not true?a)If del-credere’s commission is allowed, bad debt will not be recorded in the books of consignorb)If del-credere’s commission is allowed, bad debt will be debited in consignment accountc)Del-credere’s commission is allowed by consignor to consigneed)Del-credere’s commission is generally given to promote credit salesCorrect answer is 'B'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Which of the following statement is not true?a)If del-credere’s commission is allowed, bad debt will not be recorded in the books of consignorb)If del-credere’s commission is allowed, bad debt will be debited in consignment accountc)Del-credere’s commission is allowed by consignor to consigneed)Del-credere’s commission is generally given to promote credit salesCorrect answer is 'B'. Can you explain this answer?.
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