The Two Methods of Accounting for Bad Debts Are the Direct

question 38

Multiple Choice

The two methods of accounting for bad debts are the direct write-off method and the allowance method. When comparing the two, which of the following is true?

• A) The direct write-off method is exact and also better illustrates the matching principle
• B) The allowance method is less exact but it better illustrates the matching principle
• C) The direct write-off method is theoretically superior
• D) The direct write-off method requires two separate entries to write off an uncollectible account

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Definitions:

Traditional Unstructured

Pertains to methods or processes that lack formal organization or planning, often relying on customary practices rather than systematic approaches.

Behavior-Based

An approach focusing on observable actions and behaviors, often used in the context of evaluations, safety practices, or therapy.

Structured Interview

A systematic interviewing method where all candidates are asked the same set of predetermined questions for the purpose of making fair and objective comparisons.

Job Sample Simulation

A pre-employment assessment technique where candidates perform tasks or work activities that mirror the actual job responsibilities.