The bathroom is offset from the beds, located in a corner of the room near the entrance. Standard double room bathrooms are often equipped with towels, floor mats, plastic water cups, hairdryers and assorted travel size bottles of soap, shampoo, body lotion and conditioner.
Therefore a provision account called allowance for doubtful accounts is credited in the adjusting entry. Thus: The bad debts expense account, just like any other expense account, is closed to income summary account of the period. The allowance for doubtful debts is contra-asset account. Accounts Receivable. $15,000.
Here, the account Bad debt expense is a normal expense category account whose balance increases with a debit transaction. The other account, Allowance for doubtful accounts is an asset category account, but it is also a contra asset account.his, in turn, creates an entry in a balance sheet account (contra asset account) called allowance for doubtful accounts, The examples below explain and illustrate how a company writes off bad debt and how these accounts impact each other.