The bad debt reserve represents:

A) money that will be paid by the company.
B) money that will be paid by customers.
C) the fact that not all receivables are collected in the normal course of business.
D) insurance against bad debts.

The bad debt reserve is an allowance that a company creates in anticipation of customers who will not pay their outstanding balances. This represents that not all receivables will be collected in the normal course of business, and the company needs to account for this potential loss. It is not money that will be paid by the company or customers, nor is it insurance against bad debts.