How to write off bad credit

[Doug Laidlaw]

The OP gave his customer money - a payment in advance, if you like.

So the customer became his debtor.  The customer owed money, just as an 
invoiced customer owes money.  In the books, he is a debtor: credit bank, 
debit the customer.  There should be a debit in the customer's ledger sheet.

So why not write the amount off to bad debts?  Bad debts is an expense 
account.  At the end of the fiscal year, it is transferred to Profit and 
Loss, which gets it out of the books.

Doug.

On Saturday 17 January 2009 6:16:21 am Derek Atkins wrote:
> Quoting Bob Taylor <bob8221 at gmail.com>:
> > On Fri, 2009-01-16 at 12:32 -0500, Derek Atkins wrote:
> >> Define "handle contra-accounts"?  Of course GnuCash lets you
> >> create contra accounts but there is nothing special about them.
> >
> > If you mean define contra accounts then:
>
> No, I meant what I wrote, "define 'handle contra-accounts'?".
> I know very well what a contra-account is.
> I don't know what you meant when you asked "does gnucash handle
> contra accounts?"
>
> -derek