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How does an over provision for bad debts reflect in an income statement and in a statement of financial position?

Economics Debt Income Finance Final Accounts
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Question added by Sharlon Moraa
Date Posted: 2017/10/01
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AIZAD ASJAD MALIK MALIK
by AIZAD ASJAD MALIK MALIK , Assistant Manager- Receivables , Lamprell Energy Limited

Well, different accountants use provision for doubtful debts in different ways.

1- Provision for doubtful debt is a contra asset account reported on balancesheet.

2- Some accountants use Provision for Doubtful debts to mean the expense reported on the income statement.

 

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