Bad Debts And Allowance For Doubtful Debts Flashcards
1
Q
What are bad debts
A
Debts owed to a company that the business will never receive
2
Q
What is the treatment of bad debts
A
Debit bad debts in only
Credit the persons account too, accounts receivable in statement of financial position
3
Q
Allowance for doubtful debts is defined as debts that are _______ _______ ___ _______
A
Are estimates of debts that’s aren’t expected to recieve
4
Q
Distinguish between specific allowance and General Allowance
A
Specific allowance
Look at expert ent tog which it will be bad
General Allowance
Bas d on what amount of what is due will prove bad
5
Q
What is treatment of allowance of doubtful debt
A
Debit s pnl expense
Credit statement financial position r
