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The first step in setting up a fishbone diagram is to determine the independent and dependent variables.
Allowance for Doubtful Accounts
A contra-asset account used to reduce accounts receivable to its net realizable value by estimating uncollectible debts.
Bad Debts Expense
An expense recognized when it is probable that receivables will not be collected and is considered a cost of doing business on credit.
Allowance for Doubtful Accounts
A contra asset account that represents estimated uncollectible amounts from customers, reducing the gross receivables to their net realizable value.
Bad Debts Expense
The cost recognized when a company determines that a customer's loan or receivable account is uncollectible.
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