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How is the provision for doubtful debts listed in the balance sheet?
  • a)
    It is listed as an expense item.
  • b)
    It is combined with accounts payable.
  • c)
    It appears directly above accounts receivable.
  • d)
    It is listed below accounts receivable.
Correct answer is option 'D'. Can you explain this answer?
Most Upvoted Answer
How is the provision for doubtful debts listed in the balance sheet?a)...
The provision for doubtful debts is listed in the balance sheet below the accounts receivable line item. It is an accounts receivable contra account and always has a credit balance. These two line items can be combined for reporting purposes to arrive at a net receivables figure.
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