For example, you made a sale on credit to a customer, but one week later the client’s business declared bankruptcy and became completely unable to pay off the credit account with you. This uncollectible debt would then be written-off by your company and recorded as an expense by accountants.
Here we are going to take an example of “write off” for sale in OpenERP. Create customer invoice and validate it.
It will create sales accounting entries like below.
Now we are getting some amount from customer as a part of his invoice.
Still there are some balance customer has to pay.
This is customer’s partial payment entry.
Now, customer is telling that he will not pay remaining amount for any reason. So it require to make settlement for our accounting means make write-off on customer invoice.
From journal item, we are selecting original sales and payment entries and using “Reconcile Entries” option.
Here we can check remaining balance that we are going to write-off.
Here we have very important option available. We have to select proper journal and account where entries will occur.
After reconcilation, there is no due amount to take from customer and invoice become PAID.