What is a Bad Debt Expense?

A bad debt expense is recorded when a consumer is unable to pay an outstanding debt due to bankruptcy or other financial difficulties. It is particularly common for businesses that operate based on credit. For example, if they offer payment terms of 15 days and they have a customer who is unable, or unwilling, to pay you back. Bad debt expense can be calculated using the direct write-off technique, which means the invoice amount is charged directly to bad debt expenditure and deducted from accounts receivable. Or, with the allowance method, where bad debts are anticipated even before they occur, and an allowance is established. You must record the expense in your company's accounting records to deduct the debt from your company's accounts after it has been collected.

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Data Integrity (definition)

Data integrity refers to the consistency and accuracy of data over its lifespan. It is important to validate data before and after a migration to check for data integrity. Data with integrity is the same before and after migration and remains error free.

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