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What Is The Difference Between Provision For Bad Debt And Reserve For Doubtful Debts And Their Accounting Implications?

April 26, 2017Accounting bad debt debts difference doubtful implications Reserve

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What Is The Difference Between Provision For Bad Debt And Reserve For Doubtful Debts And Their Accounting Implications?

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Provision for bad n doubtful debts and reserve for doubtful debts are all same. Accounting implications is if there is an increase in the provision for bad debts then we show it in the debit side of the P/L account and vice versa. This amount of provision is then deducted in the Balance Sheet from the debtors.