Question

If del-credere commission is allowed for bad debt, consignee will debit the bad debt amount to:

• A. Commission Earned A/c
• B. Consignor A/c
• C. Debtors A/c
• D. General Profit & Loss A/c

Answer 1

Answer: (A)

Commission Earned A/c

When the del credere commission is provided to the consignee the bad debts are borne by him. Hence, it will be recorded in the books of consignee and will be debited to commission earned account as commission is paid to the consignee for covering the risk of bad debts.