Allowance for doubtful debts Flashcards
1
Q
Classify the Allowance for Doubtful Debts account and explain why an allowance is made for doubtful debts.
A
(allowance for doubtful debts is minus curent asset which minuses the AR then is less of its capacity for eg AR-1250 less Al D.D- 100)
y referred to the business needing to recognise an amount in the accounting reports that is
expected not to be collected from Accounts Receivable. They also referred to the allowance recognising the
expected loss of economic benefits.
