Answer:
The correct option here is D)
Explanation:
There are two ways in which a company can report for its bad debt expense, which occurs because of selling goods and services on credit, one of them is allowance method and other is direct write off method.
In Allowance method, a company would pass an adjustment entry for the amount of losses it excepts from credit sales at the end of accounting period.
Here the bad debt expense would be debited and account receivables would be credited.
