If a Company Uses the Direct Write-Off Method of Accounting

question 1

Multiple Choice

If a company uses the direct write-off method of accounting for bad debts,

• A)It establishes an estimate for the allowance for doubtful accounts.
• B)It will record bad debt expense only when an account is determined to be uncollected.
• C)It will reduce the accounts receivable account at the end of the accounting period for estimated uncollected accounts.
• D)When an account is written off, total assets will stay the same.

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