Why Is the Allowance Method Preferred Over the Direct Write-Off

question 103

Multiple Choice

Why is the allowance method preferred over the direct write-off method of accounting for bad debts?

• A) Allowance method is used for tax purposes.
• B) Estimates are used.
• C) Determining worthless accounts under direct write-off method is difficult to do.
• D) Improved matching of bad debt expense with revenue.

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A physiological and psychological state of being awake, alert, and engaged.

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A mental state in which a person performing an activity is fully immersed in a feeling of energized focus, full involvement, and enjoyment in the process of the activity.