Create a write-off journal for a customer

This task guide will show you how to set up the parameters for write-offs and then write off transactions from the Collections, Open customer invoices, and the Customer pages. This task uses the USMF demo company.

Set up the write off parameters

1. Go to Credit and collections > Setup > Accounts receivable parameters.
2. Click the Collections tab.
3. Expand or collapse the Write-off section.
   • The Write-off journal is the general journal that will hold the write-off transactions that you create.
   • You can attach a reason code to every write-off. You can override this default at the time of the write-off.
   • Set the Separate sales tax to Yes if you want to separate the sales tax from the original transaction in the write-off.
4. Close the page.
5. Go to Credit and collections > Setup > Customer posting profiles. The write-off account will be used as the expense account or reserve adjustment in the general journal.
6. Close the page.

Write off a customer balance from the aged balances page

1. Go to Credit and collections > Collections > Aged balances.
2. Mark the row for the customer that you want to write off. For example, mark the line with Birch Company on it.
3. On the Action Pane, click Collect.
4. Click Write off.
5. Click OK.
6. Close the page.
7. Go to General ledger > Journal entries > General journals.
8. Select the journal batch number for the journal that contains your write-off. One line is created to reverse the customer balance. One or more lines are created to post the write-off to the write-off account.
9. Close the page.

Write off transactions from the collections page

1. Go to Credit and collections > Collections > Aged balances.
2. Select the name of the customer that has the transactions that you want to write off. For example, select Cave Wholesales (US-004).
3. Mark the row for the first transaction.
4. Mark the row for the second transaction.
5. Click Write off.
6. In the Reason comment field, type 'Bad debts'.
7. Click OK.
8. Close the page.
9. Close the page.
10. Go to General ledger > Journal entries > General journals.
11. Select the journal batch number for the journal that contains your write-off. One line is created to reverse the customer balance. One or more lines are created to post the write-off to the write-off account.
12. Close the page.

Write off an invoice from the Open customers invoices page

1. Go to Navigation pane > Modules > Accounts receivable > Invoices > Open customer invoices.
2. Mark the line for an invoice. For example, mark the line for CIV-000667.
3. On the Action Pane, click Invoice.
4. Click Write off.
5. Click OK.
6. Close the page.

Write off a customer balance from the customer page

1. Go to Accounts receivable > Customers > All customers.
2. Select a customer account. For example, select US-001 (Contoso Retail San Diego).
3. On the Action Pane, click Collect.
4. Click Write off.
5. Click OK.
6. Close the page.