To do this task
Go to the Customers menu and click Receive Payments.
Select the name of the customer from whom you incurred the bad debt.
Leave the amount field at 0.00.
Click on the line item that will not be paid to highlight it.
Click Discount & Credits.
Your bad debt expense account should already appear in the Discount Account field on the Discounts tab.
Enter the amount of the bad debt in the Amount of Discount field.
Click Done in the Discount and Credits window.
Note: The procedure described above does not affect your
sales tax liability.
In the Receive Payments window,
save the bad debt transaction.
Assess finance charges