Overview
When the customer leaves a balance due on an AR Invoice which you will not be able to collect, you can use the Customer Payment screen to write off the bad debt and record that money in the appropriate ledger account.
Prerequisites
Create a "Bad Debt" expense ledger account or similar.
Writing Off Bad Debt Video
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Writing Off Bad Debt Steps
- Find the open AR Invoice with a Balance Due
- Click the "Process Payment" button at the top of the Invoice screen
- Enter the Payment Type = "Adjustment' and choose the appropriate GL
- Enter the Payment Amount (the amount being written off)
- Apply the "payment" to the open invoice in order to close it out and remove it from AR Aging
- Accept the Payment.
Financial Impact
The Accounts Receivable GL is Credited and the specified (Bad Debt expense) GL account is Debited.
Training-v22-20220613BG-KB