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Provision for Bad Debt Account - Video Tutorial

In this video tutorial, we will teach you to make provision for bad debts account. It is very easy. We show its opening balance in its credit side. We show all total bad debt in its debit side which is taken from trial balance and outside adjustments. After this, we calculate new provision for bad debt and it will be shown in the debit side as closing balance. Difference of debit and credit balance of this account will show the written off value which is transferred to profit and loss account.

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