Commerce Exam > Commerce Questions > Provision for doubtful debts will appear unde...
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Provision for doubtful debts will appear under:
- a)Long – term Provisions
- b)Short – term Provisions
- c)Reserves and Surplus
- d)Other Current Assets
Correct answer is option 'B'. Can you explain this answer?
Most Upvoted Answer
Provision for doubtful debts will appear under:a)Long – term Pro...
While preparing companies balance sheet trade receivables are shown without deducting the provision for doubtful debts and it is shown in the liabilities side under short term provisions.
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Provision for doubtful debts will appear under:a)Long – term Pro...
The answer will be b. As short term provisions are the amount set aside for meeting future liability for a particular year and provision for bad and doubtful debts are short term provisions as these are made on the basis past experiences each year. The estimated value is set aside as an expense which appears either on asset side under debtors heading (detucted from debtors) or comes directly on the liability side.
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