What is the natural account balance for provisions? A. Debit and Credit B. Credit C. No balance D. Debit
Question
What is the natural account balance for provisions? A. Debit and Credit B. Credit C. No balance D. Debit
Solution
The natural account balance for provisions is B. Credit.
Here's why:
Provisions are amounts set aside to cover anticipated future liabilities or losses. They are considered as liabilities on a company's balance sheet. In accounting, liabilities are typically recorded as credit balances. Therefore, the natural balance for
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