Definition

1. Noun:
   • A debt that is unlikely to be repaid: A sum of money owed to a person or organization that is not expected to be paid back, often because the debtor is unable or unwilling to pay. It is typically written off as a loss.

Usage

• The term "bad debt" is used primarily in financial, accounting, and business contexts. It refers to a specific type of receivable that has been deemed uncollectible.
• It functions as a countable noun (e.g., , ).

Examples

• Noun:
  • The company had to write off $50,000 as a bad debt after the client declared bankruptcy.
  • An increase in bad debts can be a sign of economic trouble or poor credit management.

Advanced Usage

• "To write off a bad debt": To remove an uncollectible debt from the accounts, recognizing it as a financial loss.
  • The bank decided to write off the bad debt to clean up its balance sheet.

Variants and Related Words

• Bad debt expense (n): An accounting term for the cost incurred from uncollectible receivables, reported on the income statement.

  • The firm's bad debt expense rose sharply this quarter.

• Bad debt provision or Allowance for doubtful accounts (n): An estimate of the amount of receivables that may become bad debts, recorded as a contra-asset on the balance sheet.

  • The accountant increased the bad debt provision based on past experience.

Synonyms

• Uncollectible debt: A debt that cannot be collected.
• Defaulted debt: A debt on which the borrower has failed to make the required payments.
• Irrecoverable debt: A debt that cannot be recovered (more common in UK English).

Antonyms

• Good debt: A debt that is expected to be repaid in full and on time.
• Performing loan: A loan where the borrower is making scheduled payments.

Noun

1. a debt that is unlikely to be repaid