Accounting for IGCSE & O level - The Fundamentals Of Accounting (Section 36 - No. 14)
Which method is the best way to record an irrecoverable debt?
Debit accounts receivable, credit bad debt expense
Debit cash, credit accounts receivable
Debit bad debt expense, credit allowance for doubtful debts
Debit accounts receivable, credit allowance for doubtful debts
Explanation
The debit increases the expense and reduces the value of the allowance.
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