Which of the Following Statements About Methods of Accounting for Bad

question 7

Multiple Choice

Which of the following statements about methods of accounting for bad debts is correct?

• A)When the allowance method is used,the journal entry to write-off an uncollectible account does not change the amount reported as Accounts Receivable,Net on the balance sheet.
• B)The two methods of accounting for bad debts that are acceptable under GAAP are the allowance method and the direct write-off method.
• C)When the allowance method is used,Bad Debt Expense is equal to the write-offs that occurred during the period.
• D)When the allowance method is used,if actual results differ from the estimates,the prior year financial statements must be corrected.

---

Definitions:

Fundraising

The act of collecting financial contributions from individuals, companies, or institutions to support a cause, project, or organization.

DVD Player

A device used to play discs in digital video disc (DVD) format, capable of producing video and audio signals.

Kindergarten Readiness

A measure of the extent to which a child possesses the social, emotional, physical, and cognitive skills necessary to engage and succeed in a kindergarten curriculum.

Invented Spelling

A phase in child literacy development where children write words based on their sound, not conventional spelling rules.