A. Debit Provision for Bad Debts A/c and credit Debtors A/c
B. Debit Debtors A/c and credit Provision for Bad Debts A/c
C. Debit Provision for Bad Debts A/c and credit Profit & Loss A/c
D. Debit Profit and Loss A/c and credit Provision for Bad Debts A/c.
Provision for bad debt is a charge against profit and therefore, the entry for creating
provision for bad debts is done by debiting P&L A/c and crediting provision for bad debts
account.
Correct Answer: Debit Profit and Loss A/c and credit Provision for Bad Debts A/c. ✔
Last Updated: January 13, 2018