Bad Debt Expense on Income Statement - Financial Falconet
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Replying to @ella🥟 in intro accounting class we learn the percentage of credit sales method and aging of accounts receivable method are both acceptable methods to use for our allowance method of estimating bad debt expense. With the percentage of credit sales we can ignore the previous AFDA balance and book our estimate (total net credit sales * % historically uncollectible). For the aging of accts rec method we have to consider what is already in AFDA so we don’t double count reallt old accoun
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