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Re: Doubtful and Bad Debts
by
Eska Yazilim, Levent Karakaş
Yes, this makes sense as the write-off method for bad debts. How do we follow doubtful debts (contra account for AR)? A debt becomes doubtful and it can get paid or not after that. Here's how it is handled here:
When it becomes doubtful:
120 Account receivable -> credit 100
128 Doubtful Debts -> debit 100
Reserve for doubtful debt:
129 Doubtful Debts Reserve (-) -> credit 100
654 Bad Debt Expense -> debit 100
case 1:
Doubtful debt paid:
128 Doubtful Debts -> credit 100
100 Cash -> debit 100
Clear reserve:
129 Doubtful Debts Reserve (-) -> debit 100
671 Previous Period Income -> credit 100
case 2:
Doubtful debt becomes bad debt:
128 Doubtful Debts -> credit 100
129 Doubtful Debts Reserve (-) -> debit 100
It is very similar to allowance for doubtful debts.
2016-02-06 16:52 GMT+02:00 Gregory Mader <gmader@ursainfosystems.com>:
Simple answer- Create a bad debt expense account.Create a bad debt payment journal (just like a bank journal)Now, when you want to write off bad debt, use the payment tools, and select this bad debt journal as the method.Does this make sense?ThanksGreg
Sent from my iPhoneDear accounting experts,It is possible to write-off bad debts in Odoo. Is there a module to follow and manage doubtful / bad debts life cycle?Thanks,Levent Karakaş_______________________________________________
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