Budget Preparation

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November 6, 2020 at 2:07 pm #594261
applessauce
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Sir I have a confusion with Bad debts

In certain scenarios they remove the bad debts from the budget and in other scenarios they don’t
Please explain me why they do this
November 6, 2020 at 3:09 pm #594274
John Moffat
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It depends what budget you are preparing.

If it is a cash budget then we need the cash actually received and if there are irrecoverable debts then the cash received will be less than the amount of the sales.
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