HOW TO RECOGNIZE DOUBTFUL ACCOUNTS IN A2000

A2000 ONLINE SUPPORT DEPARTMENT

KNOWLEDGE BASE

QUESTION: HOW TO RECOGNIZE DOUBTFUL ACCOUNTS IN A2000?

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ANSWER:

Doubtful accounts are estimated portion of accounts receivable that a company does not expect to collect from customers, likely due to the customer's inability or unwillingness to pay by a business entity. Terms may vary as ‘doubtful accounts expense’ or ‘bad debts expense’.

This guide will provide steps to recognize doubtful accounts in A2000 ERP.

Pre-requisites:

• There should be chart-of-account code in expense type, terms may vary,  ‘doubtful accounts expense’ or ‘bad debts expense’, etc.
• There should be a verified value of uncollectibles such as identified and verified uncollectible invoices.

Steps to recognize doubtful accounts in A2000 ERP:

1 Get and verify the value of uncollectibles by identifying invoices that cannot be collected.

2 Issue a ‘RECEIVABLE CREDIT NOTE’ and allocate those invoices. Note – that the ‘uncollectible’ will directly deduct from AR, there is no AR contra account that will arise.

SCENARIO 1: We take for example, invoices from the customer outstanding summary, below, where CR3254 is verified as uncollectible. 

Then, from the RECEIVABLE CREDIT NOTE, allocate the CR3254-

Note:

• In RECEIVABLE CREDIT NOTE, you may enter under ‘RECEIVABLE DETAILS’ the uncollectible amount.
• Allocate the invoices to clear away the invoices from the RECEIVABLE REPORTS such as Statement of account and Outstanding customer.

SAMPLE FINAL STATEMENT OF ACCOUNT AFTER ALLOCATION:

Note-here is Statement of account after allocation, the CR 3254 is cleared away.