If a company does not use an allowance method and finds that a $500 invoice is not going to be paid the entry for that should be: Credit Bad Debt Expense, Debit Accounts Receivable Credit Bad Debt Expense, Debit Accounts Payable Debit Bad Debt Expense, Credit Accounts Payable Debit Bad Debt Expense, Credit Allowance for Doubtful Accounts Debit Bad Debt Expense, Credit Accounts Receivable