explain accounting treatment of bad debt
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ʜᴇʏᴀ ᴜsᴇʀ!
ɪᴛs ᴀᴄᴄᴏᴜɴᴛɪɴɢ ᴛʀᴇᴀᴛᴍᴇɴᴛ ᴅᴇᴘᴇɴᴅs ᴏɴ ᴛʜᴇ ғᴀᴄᴛ ᴡʜᴇᴛʜᴇʀ ᴛʜᴇ ʙᴀᴅ ᴅᴇʙᴛ ᴀʀᴇ ɢɪᴠᴇɴ ɪɴsɪᴅᴇ ᴏʀ ᴏᴜᴛsɪᴅᴇ ᴛʜᴇ ᴛʀɪᴀʟ ʙᴀʟᴀɴᴄᴇ.
ʙᴀᴅ ᴅᴇʙᴛ ᴀᴄᴄᴏᴜɴᴛɪɴɢ ᴀᴘᴘᴇᴀʀɪɴɢ ɪɴ ᴛʜᴇ ᴛʀɪᴀʟ ʙᴀʟᴀɴᴄᴇ ɪs ᴛʀᴀɴsғᴇʀʀᴇᴅ ᴛᴏ ᴛʜᴇ ᴘʀᴏғɪᴛ ᴀɴᴅ ʟᴏss ᴀᴄᴄᴏᴜɴᴛ. ᴀᴅᴊᴜsᴛᴍᴇɴᴛ ɪs ɴᴏᴛ ʀᴇϙᴜɪʀᴇᴅ ғᴏʀ ʙᴀᴅ ᴅᴇʙᴛs ᴀʟʀᴇᴀᴅʏ ᴀᴘᴘᴇᴀʀɪɴɢ ɪɴ ᴛʜᴇ ᴛʀɪᴀʟ ʙᴀʟᴀɴᴄᴇ. ɪᴛ ᴀʟsᴏ ᴍᴇᴀɴs ᴛʜᴀᴛ ᴀᴍᴏᴜɴᴛ ᴏғ sᴜɴᴅʀʏ ᴅᴇʙᴛᴏʀs ᴀᴘᴘᴇᴀʀɪɴɢ ɪɴ ᴛʜᴇ ᴛʀɪᴀʟ ʙᴀʟᴀɴᴄᴇ ɪs ᴀғᴛᴇʀ ᴅᴇᴅᴜᴄᴛɪɴɢ ʙᴀᴅ ᴅᴇʙᴛ.
ɪғ ᴛʜᴇ ᴀᴍᴏᴜɴᴛ ᴏғ ʙᴀᴅ ᴅᴇʙᴛ ɪs ɢɪᴠᴇɴ ᴏᴜᴛsɪᴅᴇ ᴛʜᴇ ᴛʀɪᴀʟ ʙᴀʟᴀɴᴄᴇ, ɪɴ ᴛʜᴀᴛ ᴡᴀʏ ᴀᴅᴊᴜsᴛᴍᴇɴᴛ sᴜᴄʜ ᴛʜᴀᴛ ᴛʜᴀᴛ ᴀʀᴇ ᴋɴᴏᴡɴ ᴀs ғᴜʀᴛʜᴇʀ ʙᴀᴅ ᴅᴇʙᴛs. ɪᴛ ᴍᴇᴀɴs ᴛʜᴇ ᴀᴍᴏᴜɴᴛ ᴏғ sᴜɴᴅʀʏ ᴅᴇʙᴛᴏʀ ɪɴ ᴛʜᴇ ᴛʀɪᴀʟ ʙᴀʟᴀɴᴄᴇ ɪs ᴘʀɪᴏʀ ᴛᴏ ᴛʜᴇ ᴀᴍᴏᴜɴᴛ ᴏғ ʙᴀᴅ ᴅᴇʙᴛ ᴀɴᴅ ɢɪᴠᴇɴ ᴀs ᴀᴅᴊᴜsᴛᴍᴇɴᴛ. ɪɴ sᴜᴄʜ ᴀ sɪᴛᴜᴀᴛɪᴏɴ ᴇɴᴛʀɪᴇs ғᴏʀ ғᴜʀᴛʜᴇʀ ʙᴀᴅ ᴅᴇʙᴛ ᴀʀᴇ ᴘᴀssᴇᴅ ɪɴ ᴛʜᴇ ʙᴏᴏᴋs ᴏғ ᴀᴄᴄᴏᴜɴᴛ.
ʙᴀᴅ ᴅᴇʙᴛ ᴀ/ᴄ ᴅʀ
ᴛᴏ ᴅᴇʙᴛᴏʀ ᴀ/ᴄ
ʜᴏᴘᴇ ᴛʜɪs ᴡɪʟʟ ʜᴇʟᴘs ʏᴏᴜ!
ɪᴛs ᴀᴄᴄᴏᴜɴᴛɪɴɢ ᴛʀᴇᴀᴛᴍᴇɴᴛ ᴅᴇᴘᴇɴᴅs ᴏɴ ᴛʜᴇ ғᴀᴄᴛ ᴡʜᴇᴛʜᴇʀ ᴛʜᴇ ʙᴀᴅ ᴅᴇʙᴛ ᴀʀᴇ ɢɪᴠᴇɴ ɪɴsɪᴅᴇ ᴏʀ ᴏᴜᴛsɪᴅᴇ ᴛʜᴇ ᴛʀɪᴀʟ ʙᴀʟᴀɴᴄᴇ.
ʙᴀᴅ ᴅᴇʙᴛ ᴀᴄᴄᴏᴜɴᴛɪɴɢ ᴀᴘᴘᴇᴀʀɪɴɢ ɪɴ ᴛʜᴇ ᴛʀɪᴀʟ ʙᴀʟᴀɴᴄᴇ ɪs ᴛʀᴀɴsғᴇʀʀᴇᴅ ᴛᴏ ᴛʜᴇ ᴘʀᴏғɪᴛ ᴀɴᴅ ʟᴏss ᴀᴄᴄᴏᴜɴᴛ. ᴀᴅᴊᴜsᴛᴍᴇɴᴛ ɪs ɴᴏᴛ ʀᴇϙᴜɪʀᴇᴅ ғᴏʀ ʙᴀᴅ ᴅᴇʙᴛs ᴀʟʀᴇᴀᴅʏ ᴀᴘᴘᴇᴀʀɪɴɢ ɪɴ ᴛʜᴇ ᴛʀɪᴀʟ ʙᴀʟᴀɴᴄᴇ. ɪᴛ ᴀʟsᴏ ᴍᴇᴀɴs ᴛʜᴀᴛ ᴀᴍᴏᴜɴᴛ ᴏғ sᴜɴᴅʀʏ ᴅᴇʙᴛᴏʀs ᴀᴘᴘᴇᴀʀɪɴɢ ɪɴ ᴛʜᴇ ᴛʀɪᴀʟ ʙᴀʟᴀɴᴄᴇ ɪs ᴀғᴛᴇʀ ᴅᴇᴅᴜᴄᴛɪɴɢ ʙᴀᴅ ᴅᴇʙᴛ.
ɪғ ᴛʜᴇ ᴀᴍᴏᴜɴᴛ ᴏғ ʙᴀᴅ ᴅᴇʙᴛ ɪs ɢɪᴠᴇɴ ᴏᴜᴛsɪᴅᴇ ᴛʜᴇ ᴛʀɪᴀʟ ʙᴀʟᴀɴᴄᴇ, ɪɴ ᴛʜᴀᴛ ᴡᴀʏ ᴀᴅᴊᴜsᴛᴍᴇɴᴛ sᴜᴄʜ ᴛʜᴀᴛ ᴛʜᴀᴛ ᴀʀᴇ ᴋɴᴏᴡɴ ᴀs ғᴜʀᴛʜᴇʀ ʙᴀᴅ ᴅᴇʙᴛs. ɪᴛ ᴍᴇᴀɴs ᴛʜᴇ ᴀᴍᴏᴜɴᴛ ᴏғ sᴜɴᴅʀʏ ᴅᴇʙᴛᴏʀ ɪɴ ᴛʜᴇ ᴛʀɪᴀʟ ʙᴀʟᴀɴᴄᴇ ɪs ᴘʀɪᴏʀ ᴛᴏ ᴛʜᴇ ᴀᴍᴏᴜɴᴛ ᴏғ ʙᴀᴅ ᴅᴇʙᴛ ᴀɴᴅ ɢɪᴠᴇɴ ᴀs ᴀᴅᴊᴜsᴛᴍᴇɴᴛ. ɪɴ sᴜᴄʜ ᴀ sɪᴛᴜᴀᴛɪᴏɴ ᴇɴᴛʀɪᴇs ғᴏʀ ғᴜʀᴛʜᴇʀ ʙᴀᴅ ᴅᴇʙᴛ ᴀʀᴇ ᴘᴀssᴇᴅ ɪɴ ᴛʜᴇ ʙᴏᴏᴋs ᴏғ ᴀᴄᴄᴏᴜɴᴛ.
ʙᴀᴅ ᴅᴇʙᴛ ᴀ/ᴄ ᴅʀ
ᴛᴏ ᴅᴇʙᴛᴏʀ ᴀ/ᴄ
ʜᴏᴘᴇ ᴛʜɪs ᴡɪʟʟ ʜᴇʟᴘs ʏᴏᴜ!
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