If an account is collected after having been previously written off,

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If an account that was previously written off is collected, there will be both a debit and a credit to trade accounts receivable. The debit will represent the amount of cash received, and the credit will be the amount of the previously written off receivable that has now been collected. Both the statement of earnings and the balance sheet will be affected by this transaction.

If an Account Is Collected After Having Been Previously Written