Reversal of Allowance account for doubtful debts

[Alvin]

Hi guys,

I have an allowance amount sitting in my balance sheet however do not have an debtors. Does anyone know what i can do with this balance. I am in the process of dissolving the company. Ideally would net against debtors but dont have an option for this. Can i take it to the income statement ? it will create income...

Regards
Alvin

 

[kirby]

Has to be cleared out through the income statement.
So DR the Allowance Account for its full amount
and CR the Income Statement account you previously used to establish the Allowance Account.