We recently sold items to a customer. Invoiced as normal. the parts are out of spec and will be tossed. We are going to be issuing a credit for the parts, but don't want to return parts to inventory. What is the best way to do this?
Hello there, @joneill1186,
The invoice now become non-collectible since you don't want to return the parts to your inventory.
You can write off the invoice and declare it as a bad debt to clear out your accounts receivable.
Make sure to review your Accounts Receivable Aging Detail report before addressing a non-collectible debt. This is to ensure your report is correct.
Here's how to pull up the report:
Once done, please follow the steps on how to write off bad debt:
Step 1: Create a bad debt account.
Step 2: Record the bad debt.
The uncollectible receivable now appears on your Profit and Loss report under the Bad debt Expense account.
For your guidance with the solution above, please check this out: Write off bad debt.
That helps your concern for today. Please let me know if there's anything else you need and I'd be glad to help.