Indirect method

Accountancy

Sir! Is it not that when we took bad debts 25 debtors will have to pay 900 and then when we are calculating net profit Net profit. 225 +/- changes in stock +50 +/- changes in creditors. -50 +/- changes in debtors. -100 (i.e 1000-900)? [Video Time Stamp: 01:27] Video Details ------------- P1 - Advanced Accounting - Without AS AS 3 Cash Flow Statement #13. Adj. for Non Cash Items

Mutchukota Akhila

CA Inter

★ 4K+

25-Jun-26 13:04

116

Answers (2)

In the problem it's given as +/- changes in debtors. -75 (1000-925) this was befor including bad debts but after including bad debts is it not +/- changes in debtors. -100(1000-900)?

Thread Starter

Mutchukota Akhila

CA Inter

★ 4K+

25-Jun-26 13:11

In that case we need to add back provision of bad debt (being non cash item)

CA Suraj Lakhotia

Admin

04-Jul-26 18:17