Commerce Exam > Commerce Questions > Recovery of bad debts written off previously ...
Start Learning for Free
Recovery of bad debts written off previously will be ?
- a)Credited to debtors A/c
- b)Adjusted against provision for doubtful debts
- c)Debited to debtors A/c
- d)Credited to Profit and Loss A/c
Correct answer is option 'D'. Can you explain this answer?
| FREE This question is part of | Download PDF Attempt this Test |
Most Upvoted Answer
Recovery of bad debts written off previously will be ?a)Credited to de...
Recovery of bad debts written off previously will be credited to Profit and Loss A/c. This means that when a bad debt is written off, it is treated as an expense and is charged to the Profit and Loss Account. However, if the debt is later recovered, it is considered as a revenue and is credited to the Profit and Loss Account.
The following are the reasons why bad debts written off previously are credited to the Profit and Loss Account:
1. Revenue: The recovery of bad debts is considered as revenue and is credited to the Profit and Loss Account.
2. Double Entry System: The double entry system requires that every transaction should have two aspects - a debit and a credit. When a bad debt is written off, it is debited to the Profit and Loss Account. When the debt is later recovered, it is credited to the Profit and Loss Account.
3. Matching Principle: The matching principle requires that expenses should be matched with revenues in the same accounting period. When a bad debt is written off, it is considered as an expense and is charged to the Profit and Loss Account. When the debt is later recovered, it is considered as revenue and is credited to the Profit and Loss Account.
In conclusion, the recovery of bad debts written off previously is credited to the Profit and Loss Account because it is considered as revenue, follows the double entry system, and is in line with the matching principle.
The following are the reasons why bad debts written off previously are credited to the Profit and Loss Account:
1. Revenue: The recovery of bad debts is considered as revenue and is credited to the Profit and Loss Account.
2. Double Entry System: The double entry system requires that every transaction should have two aspects - a debit and a credit. When a bad debt is written off, it is debited to the Profit and Loss Account. When the debt is later recovered, it is credited to the Profit and Loss Account.
3. Matching Principle: The matching principle requires that expenses should be matched with revenues in the same accounting period. When a bad debt is written off, it is considered as an expense and is charged to the Profit and Loss Account. When the debt is later recovered, it is considered as revenue and is credited to the Profit and Loss Account.
In conclusion, the recovery of bad debts written off previously is credited to the Profit and Loss Account because it is considered as revenue, follows the double entry system, and is in line with the matching principle.
Free Test
FREE
| Start Free Test |
Community Answer
Recovery of bad debts written off previously will be ?a)Credited to de...
Bad debts writen off previous year in profit and loss account, DEBIT side considering that debt as a loss. But now I get this amount of bad debts so it's a profit for me as previous year profit decreases due to bad debts (loss)debit side entry in profit and loss account and partners share of profit reduces so bad debts recovery in this year is considered as profit and recorded in profit and loss account, now the partner share of profit increase this year. so previous year effect on profit get nullify.
Attention Commerce Students!
To make sure you are not studying endlessly, EduRev has designed Commerce study material, with Structured Courses, Videos, & Test Series. Plus get personalized analysis, doubt solving and improvement plans to achieve a great score in Commerce.
|
Explore Courses for Commerce exam
|
|
Similar Commerce Doubts
Top Courses for CommerceView all
Recovery of bad debts written off previously will be ?a)Credited to debtors A/cb)Adjusted against provision for doubtful debtsc)Debited to debtors A/cd)Credited to Profit and Loss A/cCorrect answer is option 'D'. Can you explain this answer?
Question Description
Recovery of bad debts written off previously will be ?a)Credited to debtors A/cb)Adjusted against provision for doubtful debtsc)Debited to debtors A/cd)Credited to Profit and Loss A/cCorrect answer is option 'D'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Recovery of bad debts written off previously will be ?a)Credited to debtors A/cb)Adjusted against provision for doubtful debtsc)Debited to debtors A/cd)Credited to Profit and Loss A/cCorrect answer is option 'D'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Recovery of bad debts written off previously will be ?a)Credited to debtors A/cb)Adjusted against provision for doubtful debtsc)Debited to debtors A/cd)Credited to Profit and Loss A/cCorrect answer is option 'D'. Can you explain this answer?.
Recovery of bad debts written off previously will be ?a)Credited to debtors A/cb)Adjusted against provision for doubtful debtsc)Debited to debtors A/cd)Credited to Profit and Loss A/cCorrect answer is option 'D'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Recovery of bad debts written off previously will be ?a)Credited to debtors A/cb)Adjusted against provision for doubtful debtsc)Debited to debtors A/cd)Credited to Profit and Loss A/cCorrect answer is option 'D'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Recovery of bad debts written off previously will be ?a)Credited to debtors A/cb)Adjusted against provision for doubtful debtsc)Debited to debtors A/cd)Credited to Profit and Loss A/cCorrect answer is option 'D'. Can you explain this answer?.
Solutions for Recovery of bad debts written off previously will be ?a)Credited to debtors A/cb)Adjusted against provision for doubtful debtsc)Debited to debtors A/cd)Credited to Profit and Loss A/cCorrect answer is option 'D'. Can you explain this answer? in English & in Hindi are available as part of our courses for Commerce.
Download more important topics, notes, lectures and mock test series for Commerce Exam by signing up for free.
Here you can find the meaning of Recovery of bad debts written off previously will be ?a)Credited to debtors A/cb)Adjusted against provision for doubtful debtsc)Debited to debtors A/cd)Credited to Profit and Loss A/cCorrect answer is option 'D'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of
Recovery of bad debts written off previously will be ?a)Credited to debtors A/cb)Adjusted against provision for doubtful debtsc)Debited to debtors A/cd)Credited to Profit and Loss A/cCorrect answer is option 'D'. Can you explain this answer?, a detailed solution for Recovery of bad debts written off previously will be ?a)Credited to debtors A/cb)Adjusted against provision for doubtful debtsc)Debited to debtors A/cd)Credited to Profit and Loss A/cCorrect answer is option 'D'. Can you explain this answer? has been provided alongside types of Recovery of bad debts written off previously will be ?a)Credited to debtors A/cb)Adjusted against provision for doubtful debtsc)Debited to debtors A/cd)Credited to Profit and Loss A/cCorrect answer is option 'D'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice Recovery of bad debts written off previously will be ?a)Credited to debtors A/cb)Adjusted against provision for doubtful debtsc)Debited to debtors A/cd)Credited to Profit and Loss A/cCorrect answer is option 'D'. Can you explain this answer? tests, examples and also practice Commerce tests.
|
|
Explore Courses for Commerce exam
|
|
Suggested Free Tests
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
Follow Us
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup