Start networking and exchanging professional insights

Register now or log in to join your professional community.

Follow

What are the differences between provision for bad debts and provision for doubtful debts?

user-image
Question added by Tashi Gayleg
Date Posted: 2016/03/28
Mohammed  Mohsin
by Mohammed Mohsin , Senior Executive Officer , Alpha Islami Life Insurance Ltd.

Provision for doubtful debt means which a business or individual is unlikely to be able to collect.

And a bad debt provision is a reserve against the future recognition of certain accounts receivable as being uncollectable.

Frank Mwansa
by Frank Mwansa , ACCOUNTING LECTURER , FREELANCER

Thanks for invitation 

The provision for bad debts is  a provision made for specific bad debts. While the provision for doubtful debts is a contra debtors account and it shows the estimated total of future bad debts.

More Questions Like This