I have followed instructions for recording bad debts, however, the bad debts/credit memo's are showing up in under the income account and not under bad debt expense. When I run report from Chart of Accounts - Income Account, it shows the credit memo's as "Income" in the Account column. When I try to trace back to the error, I get back to the invoices the credit memo was applied to and notice that the product/items have "Income" as the Income account. However, when I change that to bad debt expense instead of Income, it still does not show up in the Bad Debt report. I'm out of ideas. Can anyone shed some light or suggest some other things I can check?