Bad Debt
jewels.p
Registered Posts: 1,774
If a Debt of £500 is irrecoverable am I right in thinking it gets debited to the Bad Debts Account and Credited to the Allowance for Receivables Account?
Its just that I am trying to do Activity 8 in the Kaplan DFS Book and it doesnt tell you.
The Question is:
At present the Allowance for Receivables is sitting at £1,000. A debt of £500 is irrecoverable and written off, and the receivables allowance is to be revised to £1,500.
I am aware that I have to deduct the £500 irrecoverable debt and increase the account from £1,000 to £1,500 but I just wanted to check the journal entries as it doesnt tell you in the answer
Thanks
Its just that I am trying to do Activity 8 in the Kaplan DFS Book and it doesnt tell you.
The Question is:
At present the Allowance for Receivables is sitting at £1,000. A debt of £500 is irrecoverable and written off, and the receivables allowance is to be revised to £1,500.
I am aware that I have to deduct the £500 irrecoverable debt and increase the account from £1,000 to £1,500 but I just wanted to check the journal entries as it doesnt tell you in the answer
Thanks
0
Comments
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Hi Jewels,
That sounds exactly right to me!
Ampsie0 -
Last time i wrote sales debtor off i did this:
Dr sales ledger
Cr customer account
Dr bad debt account
Cr allowances for receivables
Hope that helps!
Ampsie0
