When a customer fails to pay on their account, it creates a(n):

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When a customer fails to pay on their account, it is considered an uncollectible account because it is unlikely to be recovered. This results in a loss for the company and a decrease in accounts receivable. A note receivable is a formal promise of payment from another entity and is not relevant in this scenario. Accounts receivable is the amount owed by customers for goods and services already provided by the company, which is impacted by the customer's failure to pay. Decrease in revenue is a broader term and may not necessarily apply in this situation as the revenue may have already been recognized before the customer failed to pay.

When a Customer Fails to Pay on Their Account, It