What is the difference between a provision and a reserve?
- A A provision is a liability of uncertain timing or amount; a reserve is an appropriation of profit
- B They are the same
- C A reserve is a liability
- D A provision is part of equity
Answer
A provision is a liability of uncertain timing or amount; a reserve is an appropriation of profit
Provisions are charged against profit before arriving at net profit. Reserves are appropriations after it.





