What is called the offsetting account of assets in accounting?

The declining account of assets refers to the fact that when a type of asset decreases, it is not reduced on its credit, but is accounted for and reflected by the corresponding declining account. The decreasing account for fixed assets must be accumulated depreciation; The declining accounts for temporary facilities are temporary facilities amortization, etc.

For example, accumulated depreciation, provision for decline in value of inventory, provision for impairment of fixed assets. An account for the actual value of an asset on the books.

Accumulated depreciation xx Impairment provision - etc.

The allowance adjustment account, also known as the allowance adjustment account, is used as a deduction item for the original amount of the adjusted object to determine the actual amount of the adjusted object.

The adjustment method is as follows:

Adjusted Account Balance Offset Account Balance = Actual Amount.

According to the nature and content of the adjusted account, the allowance adjustment account can be divided into two types: the asset class offset adjustment account and the equity allowance adjustment account.

1. Asset class allowance adjustment account.

An asset class allowance adjustment account is used to offset the balance of an asset account to obtain the actual value of that asset.

For example, the "Accumulated Depreciation" account is used to offset the balance of the asset account "Fixed Assets". The method of deduction is as follows:

Fixed Assets "Debit Balance" "Accumulated Depreciation" Credit Balance = Net Fixed Assets.

Another example is "bad debt provision", which is the offset account of "accounts receivable" and "other receivables" accounts. The method of deduction is as follows:

Debit balance of accounts receivable, other receivables account Credit balance of bad debt provision account = net accounts receivable and other receivables.

There are also "provision for inventory decline", "provision for short-term investment", "provision for impairment of long-term investment", "provision for impairment of fixed assets", "provision for impairment of intangible assets", "provision for impairment of construction in progress", etc.

The structure of the asset class allowance adjustment account is reversed from that of the adjusted account, and the balance is in the opposite direction.

2 Equity allowance adjustment account.

An equity allowance adjustment account is used to offset the balance of an equity account to obtain the actual amount of the equity.

For example, the "Profit Distribution" account is the deduction account of the "Profit for the Year" account. The method of deduction is as follows:

Credit Balance of the "Profit for the Year" Account Debit Balance of the "Profit Distribution" Account = Undistributed Profit at the End of the Period.

Provision for bad debts.

Material cost variances.

The difference between the purchase and sale price of goods.

Provision for decline in inventory value.

Provision for impairment of long-term investments.

Accumulated depreciation. Accumulated amortization.

Provision for impairment of fixed assets.

Provision for impairment of intangible assets.

Refers to an adjustment account.

Refers to an account that is set up to adjust the book balance of an account (the adjusted account) to indicate the actual (or accrued) balance of the adjusted account. It is not only the need for economic management and accounting control, but also reflects the requirement of the principle of accounting prudence. Theoretically, adjustment accounts include offset adjustment accounts, additional adjustment accounts and offset additional adjustment accounts; In accounting practice, the offset adjustment account is the most widely used.

The accounts that belong to the set-off adjustment are: the "short-term investment impairment provision" account (used to adjust the "short-term investment" account); the "Accumulated Depreciation" account (used to adjust the "Fixed Assets" account); "Bad Debt Provision" account (used to adjust the "Accounts Receivable" account); "Provision for impairment of long-term investments" account (used to adjust the "long-term investment" account); The "Profit Distribution" account (used to adjust the "Profit this year" account), etc. In terms of account structure, the offset adjustment account is in the opposite direction to the adjusted account.

For example, the "Fixed Assets" account increases the debit side, decreases the debit side, and the balance is on the debit side; The "accumulated depreciation" account is to increase the debit and debit, and the balance is in the merchant; At the end of the period, the net book value of fixed assets can be obtained by subtracting the debit balance of the Fixed Assets account from the merchant balance of the Accumulated Depreciation account.

An allowance adjustment account is an account that is used to offset the balance of the adjusted account to obtain the balance of the adjusted account.

A contra account (write-off account) is an account that is used to offset the balance of the adjusted account in order to obtain the actual balance of the adjusted account.

Balance of the Adjusted Account – Balance of the Offset Account = Actual Balance of the Adjusted Account The balance of the adjusted account is in the opposite direction to the balance of the adjusted account.

An allowance additional adjustment account is an account that is used to both offset and increase the balance of the adjusted account in order to obtain the actual balance of the adjusted account.

When the balance of the adjusted account is in the opposite direction to the balance of the adjusted account, it is a contra account;

When the balance of the adjusted account is in the same direction as the balance of the adjusted account, it is an additional account.

The deduction account cannot be simply understood as an asset account, nor can it be said that the lender must register an increase, but it is accurate to say that the credit and debit of the account account will account in the opposite direction to similar accounts. First of all, we will introduce the deduction account, which can also be called "allowance account", which refers to the account used to offset the balance of the adjusted account to obtain the actual balance of the adjusted account.

It is expressed as a formula: the balance of the adjusted account - the balance of the offset account = the actual balance of the adjusted account.

The balance of the adjusted account is used in the opposite direction to the balance of the deducted account, and the debit of the amount incurred is used in the opposite direction. For example, the asset deduction account has "accumulated depreciation", and its adjusted account is "fixed assets", and the asset account is normally debited to increase, credit to decrease, and the balance is debited; However, the accumulated depreciation account is the opposite, with the debit decreasing, the credit increasing, and the balance on the credit. For example, the equity deduction account has "profit distribution", which adjusts the "current year's profit" account, the closing credit balance of the "current year's profit" account reflects the number of realized profits at the end of the period, and the closing debit balance of the "profit distribution" account reflects the number of profits distributed at the end of the period.

The difference between the credit balance of the "Profit for the Year" account and the debit balance of the "Profit Distribution" account represents the amount of profit distributed by the enterprise at the end of the year. Although the "Profit Distribution" account is an equity account, the debit side of the account is registered, and the credit side is registered, and the opposite is true.

It is an asset account, but the balance is on the credit side, such as the provision for inventory decline and the provision for impairment of fixed assets.

Among the accounting subjects, the accounts of borrowing and decreasing loans include accounts receivable in advance, accounts payable, other payables, long-term loans, short-term loans, employee remuneration payable, taxes payable, etc.

The accounts of borrowing and borrowing are cash in hand, bank deposits, goods in stock, raw materials, fixed assets, intangible assets, accounts receivable, prepaid accounts, and other receivables.

The allowance account is the account used to prepare the offset, which is the deduction of the corresponding account.

The contra account is the opposite of the corresponding account debit.

The balance of the allowance account is generally on the credit side.

[Answer].

Answer analysis] The "asset impairment loss" account belongs to the profit and loss account, and the corresponding "asset impairment provision" is the allowance account for the asset.

Provision for bad debts.

Material cost variances.

The difference between the purchase and sale price of goods.

Provision for decline in inventory value.

Provision for impairment of long-term investments.

Accumulated depreciation. Accumulated amortization.

Provision for impairment of fixed assets.

Provision for impairment of intangible assets.

The credit side indicates an increase, and the debit side indicates a decrease.

Because it is an offsetting account of an asset class, the debit side of the asset class account indicates an increase, and the debiting account is definitely the opposite.