Question

Accrual accounting requires that the cost associated with the failure of credit customers to pay their bills should be recorded as an expense in the period when:_____________

Answer 1

Answer:

Explanation:

Failure of credit customers to pay their bills is considered a bad debt in Accounting. This is recored as a bad debt expense in journal entries in the period when the credit sale occurred. This ensures that these bad debt expense matches the revenues earned during that period. In a company's financial statements, bad debt expense is recorded in the Income statement as selling expenses.