Accounting for IGCSE & O level - The Fundamentals Of Accounting (Section 3 - No. 28)
What is the impact of writing off an irrecoverable debt on the balance sheet?
Increases total assets.
Decreases total assets.
Increases total liabilities.
No change in total assets or liabilities.
Explanation
Writing off an irrecoverable debt reduces accounts receivable (an asset) and reduces the allowance for doubtful accounts (also an asset), so there is no net change.
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