On the ribbon go to Accounts > Chequebook and add a Deposit.
Allocate this to a 8-2000 Bad debts recovered GL Account using tax code G.
Further information
Clear the Historical Balancing Account
Suggested End Of Month Procedures
Enter Government Support Payments
Purchase a Capital Asset Under Finance
Record Debtors/Creditors Contras
ATO Reportable Sub-Contractor Payments
Share Utility Expenses with other Businesses
Understanding Debits and Credits
Use Debtors and Creditors Adjustments