Bad Debt Expense is reported on the income statement as

A) part of cost of goods sold.
B) reducing gross profit.
C) an operating expense.
D) a contra-revenue account.

Bad Debt Expense is considered an operating expense since it relates to the company's ongoing business activities and is not directly tied to the production or sale of specific goods or services. It represents the cost incurred by the company from customers who do not pay their debts, and is reported separately from the cost of goods sold and gross profit. It is also not a contra-revenue account, as it is not directly related to revenue recognition.