{"id":8809,"date":"2015-08-07T08:01:24","date_gmt":"2015-08-07T06:01:24","guid":{"rendered":"http:\/\/www.officetodo.com\/public\/?p=8809"},"modified":"2015-08-02T13:02:41","modified_gmt":"2015-08-02T11:02:41","slug":"writing-down-a-receivable","status":"publish","type":"post","link":"http:\/\/www.officetodo.com\/public\/writing-down-a-receivable\/","title":{"rendered":"Writing down a receivable"},"content":{"rendered":"<p>Should the event arise that you consider a receivable uncollectable in full or in part, that is you consider that your customer considering the circumstances wont be able to pay what they owe, you either decide to write the receivable down in value to the amount they will be able to pay (that is you\u2019re making an estimate) or off the balance sheet if you\u2019ve determined that they cannot pay you anything.\u00a0\u00a0<!--more--><\/p>\n<p>The accounting entry means two things will be impacted \u2013 the receivable (asset on the balance sheet) and the income statement:<\/p>\n<table>\n<tbody>\n<tr>\n<td><b>#<\/b><\/td>\n<td><b>Debit-Credit<\/b><\/td>\n<td><b>Account name<\/b><\/td>\n<td><b>Amount<\/b><b>\u00a0<\/b><\/td>\n<\/tr>\n<tr>\n<td><b><i>1<\/i><\/b><\/td>\n<td><i>Debit<\/i><\/td>\n<td><i>Doubtful receivables expense<\/i><\/td>\n<td><i>1,000<\/i><\/td>\n<\/tr>\n<tr>\n<td><b><i>\u00a0<\/i><\/b><\/td>\n<td><i>Credit<\/i><\/td>\n<td><i>Allowance for doubtful receivables<\/i><\/td>\n<td><i>1,000<\/i><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>&nbsp;<\/p>\n<p>Effectively to write off a receivable from the balance sheet, you\u2019d apply the same entry only that you\u2019d do it in a full amount the receivable is recognized (that is you\u2019d show the expenses in the full amount) in and take it off from the receivables ledger as well (so instead of creating this \u2018Allowance for doubtful receivables\u2019 account you\u2019d simply derecognise the balance from within the \u2018Accounts receivable\u2019 account altogether).<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Should the event arise that you consider a receivable uncollectable in full or in part, that is you consider that your customer considering the circumstances wont be able to pay what they owe, you either decide to write the receivable down in value to the amount they will be able to pay (that is you\u2019re [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[78],"tags":[],"class_list":["post-8809","post","type-post","status-publish","format-standard","hentry","category-2-8-revenue-and-receivables"],"aioseo_notices":[],"_links":{"self":[{"href":"http:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/posts\/8809","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/comments?post=8809"}],"version-history":[{"count":1,"href":"http:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/posts\/8809\/revisions"}],"predecessor-version":[{"id":8810,"href":"http:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/posts\/8809\/revisions\/8810"}],"wp:attachment":[{"href":"http:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/media?parent=8809"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/categories?post=8809"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/tags?post=8809"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}