Accounting for IGCSE & O level - Preparation Of Financial Statements (Section 11 - No. 49)
What does a 'provision for doubtful debts' represent?
Cash in the bank.
Money owed to suppliers.
An estimate of uncollectible accounts receivable.
An asset owned by the business.
Explanation
A provision for doubtful debts is an estimation of accounts receivable that will not be collected.
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