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1. Decrease Net Income
2. Decrease Liability
3. Increase Net Income
4. Increase Liability
it will decrease the income
Correct answer is 1. Decrease Net Income
1- Decrease Net Income-------
Option No.1, Net Income will decrease
it will increase liability
DR. expenses
GR. provision for bad debt
so, the answer is decrease net income and increase in liability
1 It will decrease the income because its charge to profit and loss account
1 for sure! It will DEBIT bad debt expense while CREDITING the contra-asset account of provision. Hence, decreasing the net income.
It will decrease the value of debtors. Would decrease the net income.
1. Decrease Net Income
The increased portion will be charged as expense in the income statement thereby reducing net income.
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