allowance

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Allowance

allowance

An accounting term used to describe entries on a profit and loss statement for expenses that might become necessary in the future. Examples include an allowance for bad debt, in which a certain percentage of income is deducted because of the likelihood it will be uncollectible.

References in periodicals archive ?
He found that, on average, after making allowance for quality differences, there is no significant difference between the results of the old and new managers.
By our reckoning, after making allowance for the number of selling days and changed French seasonality, the January results imply a seasonally adjusted annualised rate of under 14.
Out of ninety-seven samples of butter examined, only three were wrong, which was a great improvement, but a number of samples were suspicious; it looked as if manufacturers had succeeded in mixing a small proportion of margarine with butter, so that on making allowance for the natural variation in the article, some samples escaped condemnation.