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Realisation of Assets and Liabilities - Comprehensive

Bad debts is ...

Question

Bad debts is ________ to business concern.

A

profit

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B

loss

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C

income

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D

expense

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Solution

The correct option is B loss
Bad debts refer to the amount that the firm has not been able to realise from its debtors. It is regarded as loss and is termed as bad debt. The entry for recording bad debt is:
Bad Debts A/c Dr.
To Debtors A/c

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