hi, your work is very helpful regarding this i have a question please . How do you calculate Bad debt on an income statement when you are only given 1.to write of an amount of R998 and 2. A provision for bad debts should be provided of 5% of good debts. thank you
Hello, if the only bad debts you are given is the R998, that's the one you record in the income statement. Provision for bad debts is recorded as (Debtors control - bad debts) x 5%).
Heyy i have question say a question is phrased the same way except the allowance for previous has been given and only bad debts and bad debts are given in the trail balance but the adjust ment say bad debts written off k7400 how do we handle it
Does that mean if we get the info of "actual" Bad Debts, then we should put this info into the Expenses, while on the contrary, if it doesn't show the "actual" Bad Debts, then we can put the estimated Bad Debts(which is calculated by knowing the adjusted Allowance for Doubtful Debts) into the Expenses account?
If you have bad debts, it goes into the income statement as an expense, regardless of the change in allowance for doubtful accounts. If not, then you put nothing for bad debts. But if there is an increase in the allowance for doubtful debts, it goes to the income statement as an expense called "allowance for doubtful accounts".
There is just one point where the author has confused. When you pass an entry to add to "allowance for doubtful accounts", we debit BAD DEBT expense and credit ALLOWANCE FOR DOUBTFUL ACCOUNTS. This bad debt amount together with its opening balance is then shown as part of operating expenses. Somehow the author has led me at least to believe that instead of debiting BAD DEBT Expenses account, we need to debit operating expenses or other operating expenses. The author needs to clarify this.
please be my teacher
instablaster.
This was really helpful... I got confused but u ve really made it soo simple
Wow well summarised 🙏🙏
Well explained 🙏🙏
Your so amazing, thanks for this information God bless you
Hi, I reckon you should've explained what'd happen if the allowance entry was an income
Very helpful 😊
Thank you so much
Thanks you sir
But please my question is what will be the debtors figure if a new bad debt figure is not given
Thank you!
Why didn’t you use the adjuster bad debts balance which you subtracted to get your outstanding receivables?
I didn’t understand that part thoroughly
Thanku so much
Thank you Sir.
Thanks 😍
hi, your work is very helpful regarding this i have a question please . How do you calculate Bad debt on an income statement when you are only given 1.to write of an amount of R998 and 2. A provision for bad debts should be provided of 5% of good debts. thank you
Hello, if the only bad debts you are given is the R998, that's the one you record in the income statement. Provision for bad debts is recorded as (Debtors control - bad debts) x 5%).
@@Counttuts m
What do you do if you are not given a old Bad debt amount in the trial balance?
Thank you
Wonderful
Nice video.
Heyy i have question say a question is phrased the same way except the allowance for previous has been given and only bad debts and bad debts are given in the trail balance but the adjust ment say bad debts written off k7400 how do we handle it
Does that mean if we get the info of "actual" Bad Debts, then we should put this info into the Expenses, while on the contrary, if it doesn't show the "actual" Bad Debts, then we can put the estimated Bad Debts(which is calculated by knowing the adjusted Allowance for Doubtful Debts) into the Expenses account?
If you have bad debts, it goes into the income statement as an expense, regardless of the change in allowance for doubtful accounts. If not, then you put nothing for bad debts. But if there is an increase in the allowance for doubtful debts, it goes to the income statement as an expense called "allowance for doubtful accounts".
What do you do if there is a decrease?
There is just one point where the author has confused. When you pass an entry to add to "allowance for doubtful accounts", we debit BAD DEBT expense and credit ALLOWANCE FOR DOUBTFUL ACCOUNTS. This bad debt amount together with its opening balance is then shown as part of operating expenses. Somehow the author has led me at least to believe that instead of debiting BAD DEBT Expenses account, we need to debit operating expenses or other operating expenses. The author needs to clarify this.
Thank you