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Question
When bad debts are charged __________ account is credited.
When bad debts are charged __________ account is credited.
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Solution
The correct option is C Debtors
There are two ways to record a bad debt, which are: Direct write-off method. If you only reduce accounts receivable when there is a specific, recognizable bad debt, then debit the Bad Debt expense for the amount of the write off, and credit the accounts receivable asset account for the same amount.
There are two ways to record a bad debt, which are: Direct write-off method. If you only reduce accounts receivable when there is a specific, recognizable bad debt, then debit the Bad Debt expense for the amount of the write off, and credit the accounts receivable asset account for the same amount.
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