If it's a "bad debt" (unless you mean "debtors" - current assets), then it goes into the less current liabilities? However to make sure that you do not confuse fixed assets with current assets or vice versa then here's how to know. Ask yourself:
- How long will the asset be of use to me?
If it's long-term (buildings, equipment, machinery etc), then it's a fixed asset.
If it's short-term (cash on hand, debtors etc), then it's a current asset.
Increase in bad debts provision goes into p+l. Bad debts provision are a negative current asset. Bad debts are an expense in the p+l. If it happened during the year, minus it from the debtors and put it in as an expense
See bad debts does not go into the Balance Sheet at all:
Case closed, I'm correct.