- Create a Flat Rate Product/Billing Item:
- In Records, click Products and Billing Items
- Click New Flat Rate Billing Item
- In the Description field, enter Bad Debt Write Off
- Select the GL Distribution Tab of the Product/Billing Item
- Enter the Expense account as the Credit Account
- Enter the A/R summary (or suspense account) as the Debit Account (This option is only necessary if using a multi-AR system)
- Click Save and Close
- Add a credit for the client record using the Bad Debt Write Off Product/Billing Item
- Apply the credit to the invoice to write off
- Click Save and Close
Note: To verify that the distribution of the bad debt expense is correct, after saving the credit memo, click the Dr/Cr Entries button on the GL Distribution tab