Accounting for IGCSE & O level - The Fundamentals Of Accounting (Section 20 - No. 3)
Which of the following is a correct statement about recording an irrecoverable debt recovered?
Debit cash and credit the irrecoverable debt recovered account.
Debit the irrecoverable debt recovered account and credit cash.
Debit cash and credit trade receivables.
Debit trade receivables and credit the irrecoverable debt recovered account.
Explanation
When a debt is recovered that was previously written off, the entry is a debit to cash and a credit to the irrecoverable debt recovered account (income statement).
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