Hello Anna,
The last part of your latest post is the correct entry to make to decrease the bad debt provision
1104 Bad Debt provision DR 375.00 - reduces the balance sheet provision for non paying customers
8100 Bad Debt Written off CR 375.00 - increases profit because a debt has been paid unexpectedly
Hope that explains what the journal entry is achieving. Apologies if my first answer was confusing you.
Edited at 11 Jun 2015 07:19 PM GMT
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