How is Bad debt accounted in the Balance Sheet?


sonyboy812 asked:


My understanding is that bad debt is charged as an expense in the income statement and also remove the amount of bad debt from the asset side of the balance sheet.

if net assets = equity, then if asset is lower due to bad debt, then equity must reduce to balance the balance sheet. But, what is deducted in the equity side?

Thanks

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One Response to “How is Bad debt accounted in the Balance Sheet?”

  1. Sandy Says:
    February 16th, 2009 at 7:08 am

    Mijn begrip is dat de slechte schuld als uitgave in de inkomensverklaring wordt geladen en verwijdert ook de hoeveelheid slechte schuld uit de activakant van de balans.
    - Uw begrip is correct.

    wat wordt afgetrokken in de gelijkheidskant?
    Wanneer de slechte schuld als uitgave in de inkomensverklaring wordt geladen, zal dat uiteindelijk gelijkheid via verminderde winst gaan verminderen die tot verminderde behouden inkomens leidt.

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