ACCA FA · Chapter 7 · Question 6 of 12
What is the double entry to write off an irrecoverable debt?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) Debit Irrecoverable debts expense; Credit Receivables
Explanation
When a debt is known to be irrecoverable, the receivable is removed by crediting receivables and the loss is recognised by debiting the irrecoverable debts expense in profit or loss. Revenue is not reversed, because the sale was valid when it was made.
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