The accounting entries of bad debt provision are as follows:
1. Accounting treatment of provision for bad debts for the first time
Debit: Asset impairment loss
Loan: bad debt reserve
2. Accounting treatment when bad debts occur
Debit: bad debt reserve
Loans: notes receivable, accounts receivable, prepayments, interest receivable, other receivables, long-term receivables, etc.
3. Accounting treatment of recovering bad debts
Debit: notes receivable, accounts receivable, prepayments, interest receivable, other receivables, long-term receivables, etc.
Loan: bad debt reserve
At the same time,
Debit: bank deposit
Loans: notes receivable, accounts receivable, prepayments, interest receivable, other receivables, long-term receivables, etc.
4. Accounting treatment of bad debt reserve in subsequent periods.
Debit: Asset impairment loss
Loan: bad debt reserve
Debit: bad debt reserve
Loans: Asset impairment losses
Accounting treatment of provision for bad debts.
The provision for bad debts is calculated through the "bad debt provision" account. At the end of the year, enterprises should conduct a comprehensive inspection of accounts receivable. If it is expected that all accounts receivable will be impaired, provision for bad debts should be made. Its accounting treatment is as follows:
1, enterprises should debit "asset impairment loss-bad debt reserve" when withdrawing bad debts; Credit "bad debt reserve". (1) If the amount of bad debt provision to be accrued in this period is greater than the book balance of bad debt provision, it shall be accrued according to the difference, and "asset impairment loss-bad debt provision accrual" shall be debited; Credit "bad debt reserve". Application Guide of Accounting Standards for Enterprises No.22-Recognition and Measurement of Financial Instruments (20 17)
(2) If the amount of bad debt provision is less than the book balance of bad debt provision, make an opposite accounting entry according to the difference and debit the account of bad debt provision; Credit the "asset impairment loss-bad debt provision" account.
2 accounts receivable that are irrecoverable shall be treated as bad debts after being approved according to the management authority, and the accounts receivable shall be resold and debited to the "bad debt reserve" subject; Credit accounts receivable, accounts receivable, prepayments, other receivables and long-term receivables.
3. Accounts receivable that have been confirmed as bad debt losses and have been written off shall be debited to accounts receivable, notes receivable, prepayments, other receivables and long-term receivables according to the actual recovered amount, and credited to the account of bad debt provision; At the same time debit "bank deposit" and other subjects; "Accounts receivable" and other credit accounts.
Investigate whether the write-off of bad debts is true and reasonable, and whether the disposal of bad debts is used to cover up misappropriation or embezzlement of public funds; Understand the debtor through investigation, and verify whether the enterprise will not record the loan repaid by the debtor, use it for other purposes or be corrupted by relevant managers.
How to record the accounting entries of bad debt provision?