PROVISION definition with examples and formula

Definition of PROVISION with formula and example to solve the problems with the suitable solution using concept in accounting keeping in mind the limitations and errors. How to calculate PROVISION with disadvantages and advantages using the rules in Cost and Management Accounting.

Provision

Provision is an amount set aside out of profit for one purpose for one year. The provisions for bad debts, provision for repair, provision for discount, provision for contingency are some examples of provision. In one accounting year there are … Continue reading

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Provision For Discount on Creditors or A/P

If any trader receives the benefit of the discount by making payment to the creditors/Accounts payable with in the prescribed time. In other words, it is an anticipated income, which a trader estimates by way of a certain percentage calculated … Continue reading

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SHORT ANSWER QUESTIONS RESERVE PROVISION & SINKING FUND

111    Write the short Answers of the following questions. 1.       What is a Reserve? Explain the different kinds of reserves. 2.             Explain the difference between the followings Provision and Reserve Specific Reserve and General Reserve Reserve Fund and Reserve Account … Continue reading

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