Question: When allowance method for bad debt expense is used, and you receive a confirmation that Customer is bankrupt and its $400 account receivable is worthless

When allowance method for bad debt expense is used, and you receive a confirmation that Customer is bankrupt and its $400 account receivable is worthless you?

debit bad debt expense for $400

Debit allowance for doubtful accounts for $400

debit accounts receivable for $400

credit allowance for doubtful accounts for $400

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