I'm confused as the Allowance for receivables is a credit balance account, but I've read that the new allowances are debited there... and why do we substract the allowances from the Irrecoverable debts expense account? I'm basing on question 11 of ACCA's 3rd quiz for before studying for the FR exam.
I'll be very grateful of any advice :)
At the initial recording of the allowance th JE should be: debt expense account (debit) and Allowance for receivables (credit) when a receivables is deemed irrecoverable the JE should be: Allowance for receivables (debit) and Trade receivables (credit)
