What Is the Normal Journal Entry for Recording Bad Debt

question 35

Multiple Choice

What is the normal journal entry for recording bad debt expense under the allowance method?

• A) Debit Allowance for Doubtful Accounts, credit Accounts Receivable.
• B) Debit Allowance for Doubtful Accounts, credit Bad Debt Expense.
• C) Debit Bad Debt Expense, credit Allowance for Doubtful Accounts.
• D) Debit Accounts Receivable, credit Allowance for Doubtful Accounts.

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Definitions:

Cash

Money in the form of coins or banknotes, especially that held to conduct day-to-day transactions.

Opportunity Cost

The benefit that is missed or given up when an investor, individual, or business chooses one alternative over another.

Proposed Use

An intended or suggested way of utilizing something, often laid out in plans or discussions before implementation.

Cash

Physical money, such as coins and bills, or balances in checking or savings accounts, available for use immediately.