Monies owed by customers (debtors) of a business for goods or services received that are unable to be collected, despite all reasonable efforts having being made to collect the amounts owed. This is more often than not because debtors have been declared bankrupt, or the cost of taking further action to collect the debts exceeds the debts’ value. The debts are written off by the business as a loss (by crediting the debtors’ accounts to eliminate any balance remaining on those accounts) and are classified as an expense.