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Sir, if there’s an adjustment wherein irrecoverable debt written of is received..
Then what will be the effects?In SOPL: Should it be subtracted from Admin cost or added to gross profit?
In SOFP: Will it increase the receivables?
In the SOPL it is subtracted for the irrecoverable debts expense.
In the SOFP it does not affect the receivables.
I do explain the treatment in my lectures on irrecoverable and doubtful debts. The lectures are a complete free course for Paper FA and cover everything needed to be able to pass the exam well.
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