Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
direct write-off bad debt
Definition Definition Receivable amount that a company is owed, but did not receive, and which may not be receivable in future.
Expert Solution
Lets start with some basic understanding.
Bad debt is a receivable which is not collected due to customer inability to pay back.
For recording such bad debt there are two methods which are,
(1) Direct write off method.
(2) Allowance method.
Step by step
Solved in 2 steps
