The Postings Made on Writing Off a Transaction

 

image\bullet.gifA sales credit note is added to the customerÆs account to which the transaction relates, using the system date, the reference from the original invoice and a details description of Bad Debt Write Off, and will be for the full amount of the transaction written off. The nominal account used will be that of the bad debt write off account and the tax code used will be T9.

image\bullet.gifThe invoice written off is allocated in full to the bad debt credit automatically.

image\bullet.gifThe customerÆs account balance (the money the customer owes you) is reduced accordingly.

image\bullet.gifThe total amount owed to you by your customers, as shown in the debtors control account in the nominal ledger, is reduced by the value of the write off (a credit posting).

image\bullet.gifThe balance of the bad debt write off account in the nominal ledger, representing the cost to your business of write offs, is increased by the value of the write off (a debit posting).

Related Topics

Write Off, Refund, Return

Invoice Refunds

Cheque Returns

Write Off Bad Debts

Write Off Accounts

Write Off Transactions

To Write Off a Transaction

Write Off Transactions Below a Specified Value

Write Off Small Overpayments