Friday, August 12, 2011

In accounting are the accounts allowances for doubtful accounts and allowances for bad debt the same?

bad debt expense is when you've decided that the money you are owed won't be collected and you record it as an expense. allowance for doubtful accounts is the amount you think won't be collected but you have not made it official - it's just there for an estimate of what won't/may not be collected.

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