Accounting for IGCSE & O level - The Fundamentals Of Accounting (Section 7 - No. 8)
Which of the following best describes the impact of a recovered irrecoverable debt on the financial statements?
Increases cash.
Increases trade receivables.
Increases profit.
Decreases the provision for doubtful debts.
Explanation
Cash increases when the debt is recovered; profit increases, and it reduces the provision.
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