[GNC] Bad Debt Recording

[Jeff]

Thanks David,
That is a clearer description of what I am doing.
The issue that I have, and maybe it is just my lack of general 
accounting knowledge, but the amount ($300) is still showing as owing 
from Bob if I either run the Client Report, or open the Invoice.

Shouldn't a written off debt effective remove that debt, so when you 
look a that client is shows they owe nothing?

This is the bit that I seem to be missing, or misunderstanding. 
Essentially how do I link it to that specific client?

Regards,
Jeff.

On 16/8/24 09:17, David Cousens wrote:
> Jeff,
>
> The standard direct write off method for bad debts would be to credit
> the Accounts Receivable for the amount of the bad debt and debit an
> Expense:Bad Debts account for that amount. That will remove the bad
> debt from your Accounts receivable and record it as an expense against
> the business as you suggested.
>
> There are more complex allowance methods where your business has a
> fraction of bad debts regularly and you are required to use accrual
> accounting.
>
> David Cousens
>
>
> On Fri, 2024-08-16 at 08:53 +1000, Jeff wrote:
>> Hi list,
>>
>> Looking for some advice in recording (writing off) some bad debts in
>> GnuCash when using the Business Invoice/Bills feature.
>>
>> Example:
>> Have Client Bob who owes (has been send and Invoice) for $1000.
>> Bob are disputing the full amount and have only paid $700.
>>
>> In GnuCash I open the Invoice and record a payment of $700.  This
>> leaves
>> Bob owing $300.
>>
>> I can record a $300 amount going into Expenses -> Bad Debts, from the
>> Accounts Receivable going directly via the Account page.
>>
>> I think that this then effectively wipes out the debt.  (This may be
>> completely wrong)
>>
>> My issue is Bob still shows as owing $300.  I, maybe incorrectly,
>> assumed it would effectively show as Bob owes nothing as we have
>> forgiven the amount owed.
>>
>> What step am I missing?
>> Can it be done through the Invoice screen to essentially "pay" the
>> invoice?  The Payment side of the Invoice only seems to show "Assets"
>> accounts (as expected).
>>
>> Regards,
>> Jeff.
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