Bad Debt Expense is considered

Question

Quizplus · Accepted Answer

Bad Debt Expense is considered a necessary risk of doing business on a credit basis. This is because whenever a business extends credit to customers, there is always a chance that some of those customers will not pay their debts. As a result, Bad Debt Expense is a normal cost of doing business on a credit basis, and it is often calculated and included as a part of a company's operating expenses. While there are measures that can be taken to reduce the risk of bad debts, such as credit checks and setting credit limits, it cannot be entirely eliminated.

Bad Debt Expense Is Considered