When the Direct Write-Off Method Is Used

question 140

Multiple Choice

When the direct write-off method is used:

• A)the estimated amount of bad debts is debited to Bad Debt Expense.
• B)the estimated amount of bad debts is debited to Allowance for Doubtful Accounts.
• C)the estimated amount of bad debts is debited to which account Accounts Receivable.
• D)bad debts are not estimated.

---

Definitions:

Self-Employed Health Insurance

A deduction available for the premiums paid on a health insurance policy covering a taxpayer who is self-employed, their spouse, and dependents.

Individuals

Persons or entities such as single taxpayers, married couples, and heads of households that are subject to personal income tax.

Alimony

Financial payments made to a spouse or former spouse under a separation or divorce agreement.

Child Support

Financial support paid by a parent to help cover the living expenses of their child or children.