Debts that a firm is unable to recover are debited to bad debts account and credited to
-
A.
Suppliers account -
B.
Sales account -
C.
Customers account -
D.
Cash account
Correct Answer: Option A
Explanation
The entry to write off a bad debt account affects only balance sheet accounts: a debit to Allowance for Doubtful Accounts and a credit to Accounts Receivable.
Accounts receivable is money owed to a company by its debtors.