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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FA – FIA FFA › Irrecoverable debt and allowances
Is allowances brought forward to next period though it is expense ?
The allowance for receivables in not an expense (only the cost of creating it or increasing it is an en expense).
Again, have you watched my free lectures on irrecoverable debts and allowances?
Yes I have watched but I am not getting why increase in allowance is added to bad debt ?
Because increasing it is an expense for the company.
As I explain in the lectures, we can show the increase a separate expense but usually (and in the exam) we just add it to the expense of writing off any irrecoverable debts and just have the one total expense.