"be entered a Net Operating loss"

Are you describing that your client was a Vendor to this bankrupt company, and not an employee, and did not lose wages?

Here's the problem with your wording: you don't Lose what you never Had.

For a Schedule C cash basis taxpayer, there is no entry for the missing part of gross income, so there is no entry for the unpaid income as a loss. "You can't write off what you didn't write on" as one of our lost members used to state.

An unpaid sale isn't a tax loss. There still is the write off of the cost (labor and materials), but there is no Profit, since there was no income. If you could enter lost income, what's stopping you from entering a $25,000 sale as $250,000?

It's going to be different on accrual basis, if this is unpaid AR, for instance.

This is why details matter.