The Balance of Allowance for Doubtful Accounts Prior to Making

question 150

Multiple Choice

The balance of Allowance for Doubtful Accounts prior to making the adjusting entry to record Bad Debt Expense

• A)is relevant when using the percentage-of-receivables basis.
• B)is relevant when using the direct write-off method.
• C)is relevant to both the percentage-of-receivables basis and the direct write-off method.
• D)will never show a debit balance at this stage in the accounting cycle.

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