The journal entry for a bad debt account typically involves debiting the Bad Debt Expense and crediting the Accounts Receivable to remove the uncollectible amount. This entry reflects the adjustment for the amount deemed uncollectible from a customer.
Profit & Loss A/c [Debit] Provision for bad debts [Credit]
Debit bad debtsCredit accounts receivable
Debit bad debtsCredit accounts receivable
You would credit the customer account and debit bad debt.
Provision for bad and doubtful debt is not go to profit and loss account, and it is go to balance sheet.
Profit & Loss A/c [Debit] Provision for bad debts [Credit]
Debit bad debtsCredit accounts receivable
Debit bad debtsCredit accounts receivable
You would credit the customer account and debit bad debt.
debit bad debtCredit allowance for bad debt
[Debit] Bad debts Account 5000 Credit Accounts receivable 5000
The general ledger journal entry for the uncollectible bad debt would be considered a loss in ledger. Debit the account named Bad Debt Expense for the amount and credit the account Accounts Receivable for the amount.
Provision for bad and doubtful debt is not go to profit and loss account, and it is go to balance sheet.
Bad debt expense account is the actual expense account for bad debts while allowance for doubtful account is the provision for account in case of any bad debts occurs in future.
The bad debt is recorded against the asset, which is the debtors control account, or account recievable, for example company A is owed $1000 by company B, during the year, company B approaches company A and states that it is going out of business and can only pay them $600, therefore the bad debt is $400 Credit the debtors account of company b with $400 and debit bad debt expense $400
[Debit] Bad debts [credit] accounts receivable
Debit bad debtsCredit accounts receivable