Small balance write-offs are handled in our Cash application screen as an adjustment that is booked to an Allowance for Bad Debit GL Account. Large balance write-offs are recorded in Accounting Seed as a credit memo that is applied to the balance of the Billing to be written off.
Write-off a Small Balance
- Click Apply/Unapply from the Cash Receipt that is associated with the Billing to be written off.
- Set the Adjustment Amount field to the write off amount.
- Set the Adjustment GL Account to an Allowance for Bad Debt GL Account.
Write-off a Large Balance
- Create a Billing to the customer.
- Create a Billing Line.
- Enter a negative amount in the Rate field equal to the balance of the invoice to be written off
- Set the Revenue GL Account field to an Allowance for Bad Debt Expense GL Account.
- Post the Billing.
- Click Apply/Unapply Credit Memo from the Billing.
- Apply the amount of the Billing Credit Memo to the open Billing record.