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

question 168

Multiple Choice

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

• A) It is applying the matching principle.
• B) It will record bad debt expense only when an account is determined to be uncollectible.
• C) It will reduce the accounts receivable account at the end of the accounting period for estimated uncollectible accounts.
• D) It will report accounts receivable in the balance sheet at their net realizable value.

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Definitions:

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American Law Institute

An independent organization in the United States that produces scholarly work to clarify, modernize, and otherwise improve the law.

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A broad category that includes disorders of thought, feeling, or behavior that impact someone's ability to function.