0Bad debt is a permanent loss arises due to non receipt of amount owed by debtor or customer of a business. Hence this should be written off from book debts and debitted to profit and loss account.
Provision for Bad and doubtful debts is a charge in the profit and loss Account in anticipation of foreseeable loss of collection from book debts. Hence this is not a permanent loss and needs to be estimated and adjusted against book debts in every Balance sheet.
