Reviewing Customer Accounts
Your next step is to review your customer accounts. These are part of Accounts Receivable, a balance sheet account, and will not be closed. You certainly want to be sure to carry over any balances not yet collected.
If you have any accounts that are more than 180 days past due, you may need to consider writing off the account. You can judge that by past business experience and decide at what point you give up on trying to collect. If you do have some customers whom you have given up on, you would write off the debt to a Bad Debts Expense account.
Bad Debts Expense reflects the amount of your company’s ...