a decrease in the provision for doubtful debts result in
Answer Details
A decrease in the provision for doubtful debts results in an increase in net profit.
A provision for doubtful debts is an estimated amount set aside to cover the possibility of bad debts or non-payment of debts by customers. It is an expense that is charged against the profits of the business.
When the provision for doubtful debts is decreased, it means that the amount set aside for this purpose is reduced. This, in turn, reduces the expense charged against the profits of the business, which increases the net profit. Therefore, the correct option is an increase in net profit.