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contra
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we have sold to goods to a customer who has gone into administration and has now ceased trading. we also bought some goods from them which we have not yet paid for. is it to late to contra the accounts.
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Normally with a Contra accounting entry there needs to be some sort of agreement between the two parties to acknowledge it, either verbal or written or because they owe you money so you are writing their debt off in the form of goods you have received. It is not too late to contra an entry so long as it is in the same accounting period (1yr) that the purchase and the sale of goods took place.
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