The Direct Write-Off Method for Uncollectible Accounts

question 151

Multiple Choice

The direct write-off method for uncollectible accounts:

• A)violates the expense recognition principle.
• B)is an acceptable alternative method of recognizing Bad Debt Expense under GAAP.
• C)results in higher Bad Debt Expense for most companies.
• D)may only be used by companies that do not extend credit to their customers.

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Definitions:

Phobic Disorders

Psychological disorders characterized by an intense, irrational fear of specific objects, situations, or activities that pose little to no actual danger.

Extreme Anxiety

A heightened state of fear, worry, or nervousness that is significantly more intense than the typical responses to stress.

External Stimuli

Any information or changes in the environment outside the organism that lead to a response.

Ego Integrity

A sense of completeness and cohesion of the self, often achieved in late adulthood, reflecting on one's life as meaningful and fulfilling.