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dear sir,
can I clarity on the correct entry If customers default and some receivables are written off:
Debit Allowances for receivables
Credit Accounts receivablesOr
Debit Irrecoverable debt expenses
Credit Accounts receivablesthanks
LimingThere is more than one way of dealing with irrecoverable debts (all that matters is that the final balances are the same whichever way it is done).
The easiest and best way is to always Dr Irrecoverable debts expense Cr Receivables.
The logic and the entries are all explained in our free lectures. (Our lectures comprise a complete course covering everything you need to pass paper F3 well.)
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