What is the journal entry for bad debts recovered?


Answered 9 months ago
Answered 9 months ago
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Recovery happens when the accounts already written off are unexpectedly settled by the client. We can account for the recovery of bad debts as a reversal of write-off wherein we debit Accounts Receivable and credit Bad Debts Expense or Allowance for Bad Debts. Additionally, we also debit Cash and credit Accounts Receivable for the subsequent recognition of the collection.

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