URGENT Accounting question

[cs]

If there's a bad debt, and no provision for doubtful debt, do we have to minus bad debt from Debtor in the balance sheet?

[S.M.A.T]

It depends on the question,if the bad debt is in the additional information you must minus it from Debtor  and if it is in trial balance than bad debt should not be subtract from the debtor in the balance sheet.

I can explain you more elaborately if you give an example question.

[Crooked]

if it is in trial balance then bad debt should not be subtracted from the debtor in the balance sheet. Otherwise, YES.

Seconded.

[cs]

here it is:

[Crooked]

See, the thing is, yuh don't have to show the workings on the balance sheet fer the bad debts. The value of debtors in the balance sheet is the value after deducting the bad debts. However the bad debt is treated as an expense and must be debited to the Profit and Loss A/c.

Do yuh understand or do yuh want me to elaborate further?

[cs]

See, the thing is, yuh don't have to show the workings on the balance sheet fer the bad debts. The value of debtors in the balance sheet is the value after deducting the bad debts. However the bad debt is treated as an expense and must be debited to the Profit and Loss A/c.

Do yuh understand or do yuh want me to elaborate further?

you mean it is in the information is in the trial balance, therefore don't need to deduct from debtors?

[S.M.A.T]

here it is:

In the question you have given you don't need to subtract bad debts from debtor in the balance sheet this is because the bad debts is not written in the additional information which means the effect of the bad debt is already taken on the debtor so you don't need to subtract it from debtor in the balance sheet.

For example in the question below 'Debts of $200 were to be written off'  is in Additional information at 30 April 2008 which means the debtor amount($9 000) showed in 30 April 2008 balances is before the bad has been written off from the the debtor amount,so in this question you must subtract $200 from $9000 in the balance sheet.

Hope that helps

[Crooked]

you mean it is in the information is in the trial balance, therefore don't need to deduct from debtors?

Yuh need to concentrate on the dates when yer doing accounting. They've prepared the final accounts of 30th nov 2009. In the additional part, they've given the projected debtors as 12000 as at 30th nov.  Yuh need to calculate the bad debts from the question. It's pretty easy and therefore i won't be explaining it unless yuh request me to.

And as bad debts are expenses, they'll only be recorded in the P n L a/c.

Anymore queries?

[cs]

Thanks both of you. +rep Now i understand it.. really helpful