Settlement Fees and Payments
After taking a client to court the settlement is paid directly to the lawyer. If we settle for $1000 on a particular client the lawyer will take his $300 and and send us a settlement check for $700 to apply towards the clients account. How do I clear the $300 balance on clients account considering it was paid by client at settlement, it was just kept by lawyer for his fees. I don't know what to debit and what to credit.
Debit - Lawyer expense
Credit - (account) where the balance of $300 exists.
zahid
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